|NEWS AND ANALYSIS
WAYNE COUNTY SEEKS TO AVOID BANKRUPTCY THROUGH CONSENT PACT
Wayne County completed a consent agreement with the Michigan Department of Treasury, moving the home of Detroit a step closer to state oversight in a bid to mend its finances, Bloomberg News reported today. The pact, which keeps local officials in charge, is an alternative to bankruptcy and becomes effective after the 15-member county commission approves it, according to the office of County Executive Warren Evans. The commissioners received a copy of the 12-page agreement. Once it is approved by the commission and signed, the county executive's office has 30 days to keep negotiating with unions before Evans can use his powers under the pact to impose pay or benefit cuts. Evans has said that he wants to work with the county's nine unions, which have expired contracts, to find solutions. The state oversight will help the county cut costs to fill its annual deficit of $52 million and work to manage a pension system that is less than 50 percent funded. Read more.
U.S. BANKING REGULATOR WINS REVIVAL OF MORTGAGE BOND LAWSUITS
A U.S. appeals court yesterday handed a significant victory to federal regulators suing banks over their sale of mortgage-backed securities ahead of the 2008 financial crisis, reviving a pair of lawsuits dismissed last year for being filed too late, Reuters reported yesterday. The U.S. Court of Appeals for the Fifth Circuit in New Orleans said that the Federal Deposit Insurance Corp. could sue Deutsche Bank AG, Goldman Sachs Group Inc. and Royal Bank of Scotland Group Plc for making false statements in selling $840 million in mortgage bonds to a failed Texas bank. The court ruled that a federal law passed in 1989 after the savings and loan crisis extended the time period that the FDIC could sue on behalf of Guaranty Bank and other banks that it took into receivership. The banks last year convinced a judge in Austin, Texas, to dismiss the 2014 lawsuits, saying that the federal law did not preempt a Texas state law that required the cases to be filed within five years of the securities' sale in 2004 and 2005. But Circuit Judge Carolyn Dineen King, writing for a three-judge panel, said that it was "highly unlikely" Congress would have extended some but not all time limits. The federal statute, she wrote, gave the FDIC certainty that in a financial crisis it could focus on dealing with bank failures and investigating potential claims rather than "combing through statute books" for potential time limits. Read more.
CREDIT SUISSE NEARING RECORD SETTLEMENT TIED TO WRONGDOING AT "DARK POOL"
Credit Suisse Group AG is in talks with regulators to settle allegations of wrongdoing at its "dark pool" with a record fine in the high tens of millions of dollars, the Wall Street Journal reported today. The Swiss bank is negotiating a joint settlement with the New York Attorney General and the Securities and Exchange Commission. A deal could come as soon as the next several weeks, though talks could still fall apart. The settlement under discussion would lead to the largest fine ever levied against an operator of a private trading venue. Dark pools, which allow buyers and sellers to swap shares with greater anonymity than they can on the stock market, have come under scrutiny from regulators in the past several years, and enforcement activity has been heating up lately. Investment Technology Group Inc., a New York brokerage, said last month that it had set aside $20.3 million to settle allegations of wrongdoing related to its dark pool, Posit. The largest case before that was against UBS Group AG, which in January agreed to pay $14 million to settle allegations that it created an uneven playing field inside its dark pool. Barclays was accused by the New York Attorney General of fraud in its dark pool, but so far has opted to fight the case in civil court. Credit Suisse operates the largest dark pool in the U.S. Called CrossFinder, it matched more than 430 million shares during the week beginning July 20, according to data from the Financial Industry Regulatory Authority. Read more. (Subscription required.)
M&A DEAL ACTIVITY ON PACE FOR RECORD YEAR
Global mergers and acquisitions are on pace this year to hit their highest level on record, thanks to a buying spree from companies on the hunt for growth, the Wall Street Journal reported today. Takeover-deal announcements would reach $4.58 trillion this year if the current pace of activity continues, according to data provider Dealogic. That tally would comfortably exceed the $4.29 trillion notched in 2007, a record year for deal-making. Several trends are creating ripe deal-making conditions, bankers, analysts and investors say. The slowing pace of profit and revenue growth is one. Corporate bottom lines have been squeezed this year by the soaring dollar -- which makes it harder for companies to compete overseas -- as well as the uneven economy and falling commodity prices. Read more. (Subscription required.)
AUTHOR DISCUSSES FORENSIC ACCOUNTING AND COMMERCIAL FRAUD ISSUES ON ABI PODCAST
ABI's latest podcast features ABI Deputy Executive Director Amy Quackenboss speaking with Kathy Bazoian Phelps, co-author and the editor of ABI's Fraud and Forensics: Piercing Through the Deception in a Commercial Fraud Case. A partner with Diamond McCarthy LLP in Los Angeles, Phelps co-chairs ABI's Commercial Fraud Committee and pulled together nearly 25 authors, including some from within the committee, to deliver this comprehensive guide on forensic accounting and commercial fraud issues. Click here to listen.
To purchase a copy of Fraud and Forensics: Piercing Through the Deception in a Commercial Fraud Case, please click here (be sure to log in first to obtain the ABI member price).
MISS LAST WEEK'S BANKRUPTCY JUDGES ROUNDTABLE EXAMINING COMMISSION RECOMMENDATIONS ON RESOLVING COURT SPLITS? ABI CLE SITE HAS YOUR REPLAY!
Not able to attend/watch Tuesday's 2015 Bankruptcy Judges Roundtable to examine the Chapter 11 Reform Commission's recommendations on resolving court splits? Watch it and earn CLE at your convenience as video of the Roundtable is now available on ABI's CLE site! The Roundtable features four bankruptcy judges discussing the Commission's recommendations and issues surrounding court splits identified in its Final Report. You will have the opportunity to earn 1.5 hours of general CLE credit in 60-minute-hour states and 1.5 hours of credit in 50-minute-hour states for the program. Click here to order the online video.
ABI WANTS TO SEE YOU IN PHOENIX THIS DECEMBER FOR THE WINTER LEADERSHIP CONFERENCE!
Join ABI on Dec. 3-5, 2015, at the historic Arizona Biltmore in downtown Phoenix for the 27th Annual Winter Leadership Conference. This can’t-miss event is always a member favorite and this year will be no exception! There will be topics designed for consumer and business practitioners, as well as financial advisors. Earn up to 12/14 hours of CLE/CPE credit and 2.75/3 hours of ethics, and enjoy a plethora of social and networking events.
Highlights from the conference include:
- Optional events, including a golf tournament, kayaking, tennis, horseback riding and much more
- Great Debates on chapter 11 plans, whether a bankruptcy judge can disband a creditors’ committee and must a creditor file a proof of claim
- BAPCPA Consumer Issues: 10-Year Anniversary Special
- Nine joint committee sessions, provided by ABI's 18 committees
- A live Bloomberg "Eye on Bankruptcy" luncheon presentation
- A special Casino Night!
- A judges’ roundtable on hot-button issues
Early-bird registration ends Oct. 2 so be sure to register to take advantage of the savings!
ATTENDING AN ABI CONFERENCE? MAXIMIZE YOUR EXPERIENCE WITH THE OFFICIAL ABI EVENTS APP!
With this interactive mobile app, you can:
- View a complete listing of ABI events
- View the full schedule for specific ABI conferences, including all educational sessions and networking and optional events
- Access conference educational materials
- Access maps of meeting spaces and get information about the hotels and host cities
- View ABI conference exhibitors and sponsors
- Create your own profile, message other conference attendees, post photos and view up-to-the-minute schedule changes for ABI conferences
- Access information from previous ABI conferences
Everything you need to attend ABI events is a few taps away: Download the ABI Events app today!
- iOS: https://goo.gl/mVO5JG
- Android: https://goo.gl/CJyLaL
ABI thanks Donlin, Recano & Co. for its generous sponsorship of the ABI Events app.
ON-DEMAND VIDEO COURSE HELPS YOU PREPARE FOR THE ABC BOARD CERTIFICATION TEST!
Achieving American Board Certification (ABC) means you have met the rigorous, objective standards of a top professional in the areas of bankruptcy and/or creditors' rights. The ABC Exam is the essential step in this process, and this 5-part on-demand course will prepare you for the test. This intro video explains the benefits of ABC certification, the steps in the process and what to expect in the exam. The full exam prep course will qualify for 6 hours of CLE credit (where permitted for online learning), including 1 hour of ethics. The course is $295 for ABI members; $395 for non-members. The non-member $395 fee also includes 1 year of ABI Membership (a $295 value). Click here for more information and to purchase the course.
NEW CASE SUMMARY ON VOLO: IN RE ERNEST KEN HENRY (6TH CIR.)
Summarized by Dean Langdon of DelCotto Law Group PLLC
The Sixth Circuit BAP affirmed the order of the U.S. Bankruptcy Court for the Southern District of Ohio dismissing the debtor's chapter 13 case, finding that the decision to dismiss was not an abuse of discretion as the pro se debtor had options to make sure an amended plan was timely filed.
There are more than 1,800 appellate opinions summarized on Volo, and summaries typically appear within 24 hours of the ruling. Click here regularly to view the latest case summaries on ABI's Volo website.
NEW ON ABI'S BANKRUPTCY BLOG EXCHANGE: RECALIBRATION OF THE "SUBPRIME" LABEL BY LENDERS
A recent blog post looked at examples of lenders recalibrating the "subprime" and "deep subprime" labels to different places on the credit score range.
To read more on this blog and all others on the ABI Blog Exchange, please click here.
INSOL International is a worldwide federation of national associations for accountants and lawyers who specialize in turnaround and insolvency. There are currently 23 member associations worldwide with more than 9,800 professionals participating as members of INSOL International. As a member association of INSOL, ABI's members receive a discounted subscription rate. See ABI's enrollment page for details.
Have a Twitter, Facebook or LinkedIn Account?
Join our networks to expand yours.