Our FIRREA team includes a former DOJ Trial Attorney that is one of the nation’s preeminent leaders in handling FIRREA matters. While at DOJ, he served as the lead Trial Attorney on a matter that recovered more than $2 billion, the largest penalty ever obtained against an entity whose participation in the residential mortgage-backed securities (RMBS) market did not include a substantial broker-dealer operation.
Before that, he defended a nationwide financial institution in a FIRREA case that led to the first post-financial crisis FIRREA trial by DOJ. At the conclusion of the case, the defense obtained a complete victory.
Passed in 1989, and used in the early 90s to address fraud stemming from the Savings and Loan Crisis, FIRREA lay largely dormant until the financial crisis of the late 2000s. In early 2012, DOJ announced a new Financial Fraud Enforcement Task Force and began aggressively pursuing companies for FIRREA violations. While first used to remedy RMBS fraud, FIRREA’s use has expanded to numerous other arenas, including Federal Housing Administration matters, foreign exchange trading, banking oversight, and even the recent Volkswagen emissions scandal.
DOJ’s success in FIRREA matters—recovering more than $70 billion to date—will ensure that it continues to be a favorite arrow in DOJ’s quiver.
FIRREA provides for hefty civil penalties if individuals or companies violate one or more of fourteen enumerated criminal statutes, including statutes such as mail fraud, wire fraud, bank fraud, false bank records, and false statements to the government. Importantly, the burden of proof for establishing a criminal predicate violation is by a preponderance of the evidence, and therefore individuals that are not prosecuted or found guilty for these criminal violations, can still be required to pay significant FIRREA penalties.
We represent clients in all phases of FIRREA matters, including internal investigations, subpoena response, DOJ investigation, and litigation defense.