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Subprime Mortgage Crisis

Subprime Mortgage Crisis. Peter Marchel J.D., M.B.A., CPU. As of February 2008 Between 191 – 278 lawsuits filed.

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Subprime Mortgage Crisis

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  1. Subprime Mortgage Crisis Peter Marchel J.D., M.B.A., CPU

  2. As of February 2008 Between 191 – 278 lawsuits filed

  3. Litigation expected to arise from three sources:1. Investors who have sustained investment loses 2. Contracting parties who did not receive promised contractual benefits3. Customer or clients who were disappointed in the professional services they received from a provider of such services

  4. Subprime related claims categories • Claims relating to the purchase of residential real estate secured by subprime mortgage loans • Individual home purchaser lawsuits or class actions • Claims by mortgage insures against subprime lenders • Criminal or regulatory actions

  5. Subprime related claims categories • Claims relating to the Sale of securities secured by subprime mortgage debt • Claims against plan fiduciaries • Claims against investment advisors by their clients • Claims against public companies with substantial subprime securities holdings • Claims against hedge fund advisors by investors

  6. D&O vs. E&O Claim • When did insured become aware of potential claim? • What conduct was the insured engaged in? • Sales practices • Lending practices • Property valuation • Wavier of financial requirements • Misrepresentations

  7. D&O vs. E&O Claim • Regulatory or Criminal investigation? • Repayment of fees or unwinding of transaction • Enforcement of alleged contractual obligation? • Punitive or treble damages being sought by plaintiff

  8. D&O vs. E&O Claim • So what does all this mean?

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