No matter how careful you are to follow all the requisite state and federal laws surrounding financial institutions, it is still possible that you will become involved in litigation. Banks in particular, given that they are trusted with the holding and lending of currency, are particularly open to lawsuits if there is any suspicion of wrongdoing.
Financial Industry Violations
There are a number of violations that may be investigated in the financial industry. Among these is non-compliance with the following laws or acts:
- Credit Card Protection Laws
- Equal Credit Opportunity
- Consumer Protection Laws
- Dodd-Frank Act
- Fair Credit Reporting Act
- Truth in Lending Act
- Fair Debt Collection Practices Act
In order to prepare to defend your institution against the allegations of fraud or other misdeed, you will have to gather ample evidence to prove your innocence. This can be extremely time consuming, and the necessary research can be augmented by seeking the assistance of a litigation support specialist. In addition to helping prepare your case, a specialist can also be called to the stand to be a witness for your defense. This gives more credibility to your side of the story than having an employee talk through the evidence, as they are seen as impartial experts.
Loan Reviews and Economic Volatility
Given the concerns that the U.S. is heading into a recession that may be worse than that of 2008, many companies, particularly retail businesses, may be in danger of defaulting on their leveraged loans. At a time like this, loan reviews may be looked at more closely than ever, meaning that preparing for potential litigation may be more important.
All businesses are must protect themselves from potential litigation, and financial institutions are certainly no exception. While it may be rare that such companies intentionally set out to commit fraud, your practices must be ready for close scrutiny.