What the DOJ Wants When It Comes Knocking

The Department of Justice has emerged as a formidable banking regulator, a fact underscored by its recent $16.7 billion mortgage settlement with Bank of America. Now the DOJ is investigating banks large and small in a variety of mortgage fraud and Operation Choke Point cases. By the time the DOJ confronts a bank with a threat of litigation, it has already conducted months of discovery, having foraged through emails, documents, testimony and a range of other discovery goldmines. Whether the assertions listed in the complaint are provable or not, they can be a motivating force toward settlement. And since most cases do settle, the scope of the law is actually being determined by the DOJ rather than the courts.

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