Wilmington, Delaware, November 10th, 2008 â€“ The South Asian Bar Association of Delaware (SABA-DE) filled the du Barry Room at the Hotel du Pont with Delawareâ€™s legal, business and community leaders for its â€œDecoding the Market Meltdown: Next Steps to Economic Securityâ€ event. Bifferato Gentilotti LLC and Skadden Arps sponsored the Program, which was approved for CLE credit in Delaware, and the preceding cocktail reception.
The timely discussion was focused on the unfolding economic turmoil, including its causes, the effects yet to come, and possible ways to stabilize and secure our economy in the days and years ahead. The Panel, moderated by Raj Srivatsan, Esq., an Associate in the Corporate and Commercial Litigation Department at Bifferato Gentilotti LLC, consisted of:
- William J. Sweet, Jr., Esq., Partner | Financial Institutions Merger and Acquisition, Regulatory and Enforcement Matters | Skadden, Arps, Slate, Meagher & Flom LLP in Washington, DC
- Todd Cipperman, Esq., Managing Principal | Cipperman & Company | Investment Management Lawyers, Philadelphia
- David Moffat, Managing Director | Huron Consulting Group, New York
- Reuben Advani, Managing Director | Telestrat Education, Philadelphia
Moderator, Raj Srivatsan kicked off the evening by noting that the equity positions taken by the government in private organizations for the first time in decades signaled that the overall system had failed. â€œA fresh look at the components of regulatory, accounting, credit and risk assessment systems is the need of the hour to ensure greater integrity in the system” he said.
Reuben Advani, author of â€œThe Wall Street MBAâ€, emphasized that multiple factors contributed to the meltdown including aggressive mortgage loan practices and unsecured lending, a lack of understanding of the worth of securities, difficulty in establishing the reasonable value of offending securities (e.g., subprime-based instruments), collateralized debt obligations, and credit default swaps using the mark-to-market methodology.
Todd Cipperman noted that current events were primarily risk management mistakes and not regulatory breakdowns, although he acknowledged the likely existence of predatory lending practices and lack of sufficient net capital oversight. He expects significant regulatory overhauls including the merger of the SEC and the CFTC and the possible creation of a super-regulator than would encompass them both. He also predicted that the government would look to foreign regulatory models such as the FSA in the UK, which regulates whole entities rather than their specific activities.
Accountant David Moffat stated that the lack of meaningful disclosures and misinterpretation of FAS157 contributed to the economic crisis. â€œWhile the accounting system is generally otherwise adequate, it perhaps could have provided more concise information about the underlying assumptions on which the asset values were based,â€ said Moffat.
Bill Sweet, a former Federal Reserve Board attorney, discussed the essential components of the Troubled Asset Relief Program passed by Congress on October 3, 2008 in detail and opined that the regulatory system could witness marked restructuring involving market, prudential and corporate conduct regulation.
A lively discussion followed the program with several pointed questions from the audience. Attendees left impressed and with a sense of immense appreciation for the program. â€œAs timely and informative as any CLE I have attended. I left with a far greater understanding of the current financial situation in the U.S. and the world,â€ said Todd Goodman, Assistant General Counsel for Delmarva Power, a PHI Company.
â€œSABA-DE is delighted by the positive feedback and the continued support it has receivedâ€ said Emilie R. Ninan, Esq., President of SABA-DE, â€œWe certainly plan to continue to bring speakers on topics of interest to Delaware.â€
SABA-DE is a voluntary bar organization with a mission to serve the needs of attorneys, law students, other individuals and communities of South Asian descent, and act as a resource regarding the increasing social, economic, and legal intersections between the U.S. and South Asia. For more information on SABA-DE, visit www.sabade.org.