Bank Lawyer's Blog

Bank of America Propels Young Lawyer To Fame and (Potential) Fortune

Eighteen months ago, we made the official call: "B of A has become the poster child for foreclosure dysfunction." Of course, we were way late in throwing that flag, but unless we could belabor the obvious, we'd be out of blogging material.

The incident that prompted our banal observation was the sweet foreclosure by a wrongfully foreclosed-upon Florida couple upon a Bank of America branch, a theatrical performance engineered by an attorney only eight months out of law school. It turns out that the lawyer, Todd Allen, has turned his fifteen minutes worth of fame into a potential career in Hollywood.

Allen said his life has changed quite a bit. He never anticipated getting nationwide attention.

"After that, my career took off," said the 35-year-old East Naples resident who is originally from Utah. "I started getting a lot more business and a lot more referrals."

Allen, of the Naples firm Goede & Adamczyk, is voluntarily taking more free cases and quickly became a national media source for the foreclosure crisis.

[...]

What surprised Allen the most was receiving calls from people out of the state all facing foreclosures, he said.

[...]

In summer 2011, Allen and the Nyergeses signed with a producer in Los Angeles and entered into a contract to make a movie.

"The idea is being shopped around to movie houses but nothing has happened yet," Allen said.

Allen said he doesn't have a preference of which company decides to do the film as long as the scope of the foreclosure crisis and the impact it has on people is accurate.

When asked who he wants to play his part, the married father of three children said he really doesn't care.

"I just want it to be funny," he said of the movie.

I'm sure it will be funny Todd, although The Daily Show "report" on the incident will be difficult to top.

Putting Your Money Where Your Rage Is

I was trying to decide which group, Occupy Wall Street or The Tea Party, better epitomized the "little ball of hate" approach to political discourse and I could not decide. Therefore, I've decided to join both groups, so that I can become a living, breathing version of Munch's painting "The Scream," 24/7/365. While Dean Wormer may have told Flounder that "Fat, drunk and stupid is no way to go through life, son," I'm pretty sure he never said a word about going through life "enraged."

According to The Puget Sound Business Journal's Kelly Giblom, big banks in this country are presently receiving boatloads of rage as a result of their recent adventures in fee-raising. At the same time, however, they're also the recipients of boatloads of something that doesn't seem to be consistent with rage: cash.

A flurry of data released today by the Federal Deposit Insurance Corp. shows those big banks have seen a significant jump in deposits in King County since last year. Meanwhile, smaller, state-based community banks have not seen a similar boost.

According to the FDIC, Bank of America had $16.47 billion in deposits on June 30, 2011, up from $15.39 billion the same day in 2010. JPMorgan Chase had $5.13 billion in deposits at the end of June this year, a $305 million jump from the year before. Wells Fargo and U.S. Bank also recorded large deposit gains of $632 million and $438 million, respectively.

Meanwhile, Washington Federal, the state's largest bank saw a more modest increase of about $4 million to record $2.55 billion in deposits on June 30, 2011. The state's second largest bank, Spokane's Sterling Savings Bank actually lost $71 million worth of deposits. It had $530 million in deposits in King County at the end of the second quarter.

I see Ariana Huffington's "Move Your Money" campaign has been a raging success (it never was in Texas, at any rate). Putting your money where your rage is directed is apparently something that defies the countervailing pull of cognitive dissonance. Of course, these statistics might also indicate that the reports of public anger and rage at the big, bad banks are being exaggerated by certain elements of the press and political class, and that much of what we see enacted on our television and computer screens is more political theater performed by an activist minority than reflective of widespread popular discontent. Whatever the truth, it's unlikely we're getting close to it by watching the main stream media.

You've Got To Be Kidding

I've been traveling the last few days, so last Saturday I scheduled for later auto-posting a couple of blog posts I'd written earlier, and I didn't get around to reading my blog-related e-mail until I'd hacked my way through all the work-related e-mails today. I discovered that at least one reader thought my post of Monday evening represented my personal opinion that all the blame for the current dearth of commercial lending by commercial banks was solely the fault of bank regulators.

The views expressed in Monday night's post were those of the two bankers who were quoted, and of some other community bank executives who have shared that same view with me. I didn't intend to state that it was my personal view that restrictive regulation was the sole cause for the current difficulties banks face in making commercial loans. What I intended to do was to find a news article that would allow me to end the post with the embedded Youtube video clip of the massacre scene from "The Road To Perdition" in which Paul Newman bites the dust.  As far as I'm concerned, like George Bush aboard the USS Abraham Lincoln, I can proudly proclaim "Mission Accomplished." Any misunderstandings on substantive issues are merely collateral damage.

As I periodically warn readers, anyone who ventures here with the expectation that anything I say on this blog should be taken with absolute seriousness is bound to be bitterly and profoundly disappointed.

And since we're completely off-topic on anything to do with banking or the law, is it just me or does anyone else yearn to see future "Dancing With The Stars" contestants Nancy Grace and Ron Artest engage in an Ultimate Cage Fighting tussle that puts them both in traction? I assume it's just me.

Mad Cow Recall

Regular reader and attorney Roger Hood feels bad that he hadn't alerted me to the following news story prior to my recent post that expressed incredulity that any sensate human being would ever think that this country had too few lawyers to throw into any potential black hole of billable hours. I admit that if I'd known about the American Bar Association's recall of defective lawyers, as reported by The Onion Radio News' Doyle Redland, I would have understood how a shortage might have actually occurred.

Like Denny Crane, many barristers apparently were afflicted with "The Mad Cow."

 

Hey, Let's Create a Commission!

And thus Bureaucracy, the giant power wielded by pygmies, came into the world.
---Honore de Balzac

And we've been paying the price ever since.

Today, in a speech to the Mortgage Bankers Association summit on loan servicing, Sheila Bair, obviously auditioning for her post-July job as the head of a consumer advocacy group (or keeping Liz Warren's seat warm at Harvard), called for the creation of a BP-like "foreclosure claims commission" to award compensation to the billions (no, make that bazillions)of homeowners who've been screwed in some form or fashion during the loan modification and/or foreclosure processby large loan servicers. The claims would be funded by the loan servicers, as British Petroleum funded its claims fund (after some purported arm-twisting by the White House) in the aftermath of the Gulf oil spill.

While we understand the rage generated by the well-publicized bobbles, bungles, fumbles, muck-ups and outright FUBARs of the large loan servicers (especially they're utter disdain for the rights of parrots), we pose a simple question: what's championing a "claims commission" got to do with the job description of the Chairman of the FDIC?

[sound of crickets chirping]

That's what we thought, but we just HAD to ask.

According to CNCB's Diana Olick, Ms. Bair's proposal went over with her audience "like a lead balloon." She's not afraid to go into the lion's den, as she's done many times before, and offend her audience, is she? Some see that as evidence of her courage and integrity. Others see it as a shrewed tactic to generate the most controversy and, therefore, the most publicity. Of course, when bankers pay their FDIC insurance assessments, they always take comfort in knowing that the head of the FDIC that's spending their money may not be the greatest administrator they've ever seen, but she sure as heck is one fantabulous speechifier.

Assuming the claims commission idea catches fire (and doesn't burn the house down), I had a parttner with a national law firm (who shall remain nameless to protect the guilty) suggest to me this afternoon the perfect person to head up the commission: Oprah Winfrey.

Think about it. You get all the disgruntled homeowners in the Rose Bowl. You provide them free beer and give them an inappropriate amount of time to get liquored up. Then, in sky-dives a parachutist who hits the 50-yard line, bounces up, unbuckles her harness, takes off her helmet, reveals herself to be "The Big O" and screams "You're all going to Cabo!!! With Angelina and Brad!!!"

Pitt and Jolie rise on a platform from a hidden trapdoor under the turf, dressed in sombreros and serapes, and waving and smiling as only those who have been chosen by "The One" can muster. The stunned foreclosure-screwees leap to their feet and start jumping and screaming like ten year-old females in the presence of a boy named Beiber.

"Look under your seats and reach into the mysterious black pouch," Oprah yells and the crowd scrambles to pull out and open the drawstrings on the pouches which have hitherto remained undetected. "That's right, they're car keys...to a brand, new Farrari California convertible! You're all driving one home!!!"

The pandemonium inside the Bowl reaches a frenzied pitch that can only be cooled by a circling C-130 Spectre gunship spraying the crowd with tons of cracked ice.

But "The Comish" is not quite finished.

"Now, what would you want with a fine Ferrari if you couldn't park it in the four-car garage of your very own, fully paid-for, debt-free, 6,000 square foot, McMansion!!!!!!"

On the Jumbotron flash pictures of the dream home of every buyer that bought "a house too far" and never had the scratch to actually pay for it. Now, through the miraculous ministrations of "The Care Bair" and "Deepak Oprah," their oh-so-all-American dreams have come true. There all "being made whole."

Yeah, I think this claims commission thing has legs.

I wonder if there's any way we can get Maxine Waters to play a role in it?

Seriously Absurd

Our desire to push a proposal to permit community banks to use a 10-year amortization schedule for commercial real estate losses overrode our desire last Thursday evening to post the latest example of Bank of America's mistaken seizing of the wrong house in a foreclosure-mad world and confiscating the homeowner's pet parrot, "Luke." We let public policy trump the low-hanging fruit of snarkiness, for which we sincerely apologize. Fortunately, Kevin LaCroix of D&O Diary fame was on the case and cut through all the white noise to the essential Monty Pythonesque essence of the story.

This momentous story was deemed by the Journal’s editors to be worthy of a front page photograph of the homeowner, now fortunately reunited with her beloved parrot.

 We mention this because, as was pointed out to us by a loyal reader, the Journal’s front page above- the- fold color photograph was headlined with the phrase "Hello, I Wish to Register a Complaint." We suspect that the Journal’s editors ran the picture on the front page for the sole reason that it gave them an excuse to use that headline.

 If the topic is parrots, the only possible reference is to the immortal Monty Python dead parrot sketch, which believe it or not has its own Wikipedia page, here. The skit begins with John Cleese entering a pet shop and stating (as reflected in this script of the sketch) "Hello, I wish to register a complaint." Cleese’s problem in the sketch is not that his parrot has been confiscated; rather, his problem is that the parrot he had just purchased is dead. Deceased. It is no more. It has ceased to exist. It has joined the choir celestial. This is an ex-parrot

 We are delighted to have this pretext to be able to embed a video of the sketch below. Because we think everyone should know a dead parrot when they see one.

Visit Kevin's post, click on the embedded video, and bask in the glow of the sunlight that shines on those of us who realize that we're living and working in the theater of the absurd, otherwise known as commercial banking in the 21st century.

For those of you who appreciate Kevin's insights on director and officer liability issues, you can join Kevin and Venable LLP partner John Zink for a webinar this Thursday, March 18, from 11 am to noon Central time on the topic "Here Today -- Gone Tomorrow: Making your fidelity bond and D&O Insurance stick in troubled times." That's a topic that is, unfortunately, no laughing matter for many banks and thrifts.