Tag Archives: FIRREA

Judge Pauley: Moody’s Whistleblower Whose False Claim Act Case Was Dismissed Cannot Share in Related Government FIRREA Settlement

In an opinion last week, Judge Pauley dismissed a second amended False Claims complaint brought by a former Moody’s managing director who claimed that Moody’s false ratings caused various government overpayments  (our coverage of the dismissal of the original complaint is here). The opinion notes that, as a consequence of the dismissal, the plaintiff was … Continue Reading

Second Circuit Reverses Judge Rakoff’s $1.2 Billion Penalty in BOA-Countrywide FIRREA Litigation

Today, the Second Circuit reversed Judge Rakoff’s $1.2 billion penalty against Bank of America/Countrywide for FIRREA violations (see our previous coverage here).  The case involved allegations that BoA/Countrywide had sold faulty mortgages to Fannie Mae and Freddie Mac, originally brought as a qui tam suit under the False Claims Act in which the government intervened.  The Second … Continue Reading

Judge Swain, Based on “Implicit” Overruling of Second Circuit, Rules 3-Year Limit to Sue Over False Securities Offerings Is Not Subject to “Extender” Law

In an opinion today, Judge Swain ruled Section 13 of the Securities Act, which states that no action may be brought “more than three years after the security was bona fide offered to the public” was not extended by the so-called “FDIC Extender Provision” of the Financial Institutions Reform, Recovery, and Enforcement Act (or “FIRREA”) … Continue Reading

Judge Rakoff: Challenge to Countrywide “Hustle” Jury Verdict “Borders on the Frivolous”

In an opinion today, Judge Rakoff rejected motions to set aside a jury verdict in the so-called “Hustle” case, in which the government accused Countrywide (later acquired by Bank of America) and an officer named Rebecca Mairone of a scheme to defraud Fannie Mae and Freddie Mac into buying faulty mortgages.  The jury had ruled … Continue Reading

Judge Furman Joins Consensus Endorsing “Self-Affecting” Theory of FIRREA; Splits with Judge Marrero on Scope of Predicate Bank Fraud Law

In an opinion today, Judge Furman largely denied Wells Fargo’s motion to dismiss a government lawsuit relating to its underwriting of government-insured mortgage loans. Judge Furman joined Judges Rakoff and Kaplan in holding that the Financial Institutional Reform, Recovery, and Enforcement Act (“FIRREA”), which allows the government to pursue civil charges against those who commit … Continue Reading

Judge Rakoff Rules that Bank Misconduct “Affects” the Bank Itself Under FIRREA

In an opinion posted online today, Judge Rakoff allowed the federal government to proceed with civil claims against Countrywide and Bank of America under the Financial Institutions Reform, Recovery, and Enforcement Act, or “FIRREA,” for having misrepresented the quality of home loans sold to Fannie Mae and Freddie Mac.  FIRREA applies only to conduct that “affects” … Continue Reading

Judge Kaplan Largely Denies Motion to Dismiss DOJ Suit Relating to Bank of New York’s Foreign Exchange “Best Execution” Practices

Judge Kaplan today largely denied the Bank of New York’s motion to dismiss a DOJ civil lawsuit alleging that the bank promised its customers “best execution” of foreign exchange transactions but, in fact, maximized its own profit by giving customers the worst (or near worst) prices of the day.  A key question of first impression … Continue Reading