Understanding FIRREA: Revived Law Expands Government’s Enforcement Options
Author: Benton J. Campbell.; William O. Reckler.; Brigid Morris.
Source: Volume 27, Number 03, January/February 2014 , pp.13-22(10)
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Abstract:
In an effort to pursue the financial institutions perceived to be at the heart of the current financial crisis, the Department of Justice has increasingly turned to civil statutes, such as the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), in lieu of criminal prosecutions. While FIRREA presents an attractive enforcement option, allowing for a civil standard of proof and the possibility of significant damages, it was not originally intended for its current use. The government has read the act expansively to bring actions against financial institutions that FIRREA was arguably designed to protect. In light of several favorable rulings on FIRREA’s scope—and a subsequent trial victory—we can expect that the government’s FIRREA beachhead will expand even further in the years ahead.Keywords: FIRREA; Financial Institutions Reform, Recovery, and Enforcement Act; financial crisis; financial institutions; Civil Frauds Unit; Section 1833a; federally insured financial institution
Affiliations:
1: Latham & Watkins; 2: Latham & Watkins; 3: Latham & Watkins.