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NCUA's $1 Billion Legal Contingency Fee In Crosshairs of Republican Lawmakers "Credit News 24"

POLITICO PRO is reporting that Republican lawmakers are probing more than $1 billion in contingency fees paid by the National Credit Union Administration (NCUA) to two law firms.

NCUA has recouped more than $5 billion from investment banks over the sale of faulty mortgage-backed securities to five failed corporate credit unions.

"The payment of over one billion dollars in legal fees to private counsel raises serious questions about the propriety of the NCUA's legal fee arrangements, including whether the arrangements were in the best interest of the NCUA," Representative Ann Wagner (R-MO) said in a March 1 letter to the agency's chairman, Mark McWatters. Wagner chairs the House Financial Services subcommittee on oversight.

Wagner is seeking information from NCUA regarding the agreement with the two law firms, including all records related to the selection of the law firms and all communications between the agency and the two law firms.

The two law firms are Korein Tillery and Kellogg, Huber, Hansen, Todd, Evans & Figel.

In comparison, the Federal Housing Finance Agency recovered more than $25 billion on behalf of mortgage giants Fannie Mae and Freddie Mac; but paid two different law firms, based on an hourly fee basis, more than $400 million.

The article notes NCUA met at least once with the law firms in an attempt to renegotiate the terms of the agreement.

Read the story (subscription required).

Update: Below is the Representative Wagner's letter to NCUA (click on image to enlarge). Unfortunately, the image quality of the letter is poor.







Title : NCUA's $1 Billion Legal Contingency Fee In Crosshairs of Republican Lawmakers "Credit News 24"
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