White Collar, Investigations and Enforcement

FDIC Professional Liability Litigation

Bank failures that were precipitated by the credit crisis are now the subject of litigation against directors and officers by the FDIC. There have been more than 400 bank failures since 2007; if the litigation level is similar to that of the S&L crisis, as many as 100 bank failure-related lawsuits could be anticipated.

Allegations of professional misconduct that are most commonly alleged in these cases include underwriting failures in relation to commercial real estate and construction and development loans, failure to respond to supervisory guidance, and mismanagement of high-risk banking strategies. Associated issues of liability, causation, and damages are likely to require fact-intensive expert analysis. Economic analysis can also be used to assess the conduct and performance of the directors, officers, and institutions involved.

NERA experts have backgrounds in banking and finance, regulatory institutions, supervisory roles, and in academia. Our experience includes S&L cases, more recent bank fiduciary litigation, Winstar litigation, supervisory issues, and risk management, providing empirical assessments of bank practices, performance, loan losses, and the factors that contributed to bank failure.  

Our specific areas of expertise include:

• Bank performance measurement
• Causation and damages
• Supervisory guidance and regulatory compliance
• Risk management customs and practice