February 4, 2016
Thursday’s Advocacy & Think Tank Roundup
- According to data from the federal Early Childhood Longitudinal Survey, educators must tailor support for the disadvantaged children in new environments (suburbs and small towns, as opposed to rural and inner-city areas) because they have different stressors and challenges.
- The Landscape and Urban Planning journal published a new study finding that upward mobility is significantly higher in compact areas than in metropolitan areas due to job accessibility.
February 4, 2016 | Permalink | No Comments
February 3, 2016
Dirt Law Jobs Up
The National Jurist quoted me in Hot Practice Areas For J.D.s. It opens,
Real Estate is hot again
Real estate is one of the most fickle industries around — hot when the economy is growing and cold when it is not. The good news is that real estate is growing again and that means more jobs for entry-level attorneys.
Robert Half Legal, a legal staffing agency, reports that real estate lawyer is the third most in-demand legal position in the South Atlantic region. Real estate is the second-fastest-growing legal industry in the South Atlantic region and the fourth fastest in the Mountain and Pacific regions.
At Brooklyn Law School, real estate law has become the most popular specialization. Graduates are finding more jobs in the specialization’s niche areas such as cooperative and condominium representation, said professor David Reiss.
“This is, in part because of our externship program that provides students with experience in the applicable government agencies and law firms, but also because of our Real Estate Certificate program, our wide array of real estate courses and the availability of courses at nearby urban planning schools,” Reiss said. “We also offer a Real Estate Law Certificate, and we find that most or all those receiving certificates are employed pretty quickly in any given year.”
Richard Hermann, a professor of Concord Law School who has written extensively about legal careers, recommends earning certificates in niche areas of the law, as they are inexpensive ways to increase your qualifications.
“Many such programs are available, and quite a few are online and inexpensive,” he said.
While real estate can be up and down, Reiss said real estate law could be a good field even during slower economic times.
“No matter what the economy as a whole is doing, clients are still buying and selling properties, financing and refinancing them, entering into property leases”, he said.
To prepare for careers in real estate law, Brooklyn Law School encourages its students to have very focused resumes, which increases their marketability. “We find that students with focused with focused resumes, can make a compelling case to a range of real estate employers, even if their overall GPA is not high,” Reiss said.
February 3, 2016 | Permalink | No Comments
Wednesday’s Academic Roundup
- Can Short-Term Rental Arrangements Increase Home Values?: A Case for Airbnb and Other Home Sharing Arrangements, Jamila Jefferson-Jones, The Cornell Real Estate Review, Vol. 13, June 2015.
- Residential Land Values in the Washington, DC Metro Area: New Insights from Big Data, Morris A. Davis, Stephen D. Oliner, Edward Pinto & Sankar Bokka.
- The Law of Banksy: Who Owns Street Art?, Peter N. Salib, University of Chicago Law Review, Vol. 83, No. 4, 2016.
- An Ethnic Roller Coaster: Disparate Impacts of the Housing Boom and Bust, Olga Gorbachev, Brendan O’Flaherty & Rajiv Sethi.
- Measuring House Price Bubbles, Steven C. Bourassa, Martin Hoesli & Elias Oikarinen, Swiss Finance Institute Research Paper No. 16-01.
- Cause for Rebellion? Examining How Federal Land Management Agencies & Local Governments Collaborate on Land Use Planning, Michelle Bryan, 6 Journal of Energy & Environmental Law 1 (2015).
- Macroprudential Regulation of Mortgage Lending, Steven L. Schwarcz, Southern Methodist University Law Review, Forthcoming.
- Fee Simple Obsolete, Lee Anne Fennell, University of Chicago Coase-Sandor Institute for Law & Economics Research Paper No. 739; U of Chicago, Public Law Working Paper No. 559.
- Financial and Housing Wealth, Expenditures and the Dividend to Ownership, Sheng Guo & William G. Hardin III.
- Macroeconomic Effects of Bankruptcy and Foreclosure, Kurt Mitman, CEPR Discussion Paper No. DP11043 (Paid Access).
February 3, 2016 | Permalink | No Comments
February 2, 2016
Luxury Real Estate and Transparency
Law360 quoted me in Atty-Client Privilege At Stake In Real Estate Bill (behind a paywall). It opens,
The push to reveal the individuals involved in anonymous real estate deals has moved from title insurers to attorneys and real estate agents, but lawyers say requiring them to reveal the names of clients they help set up limited liability companies and other vehicles could weaken attorney-client privilege.
Reps. Carolyn Maloney, D-N.Y., and Peter King, R-N.Y., plan to reintroduce legislation this week that would require states to collect the beneficial ownership information for limited liability companies and other vehicles used in real estate transactions, or to have the U.S. Department of the Treasury step in if states are unable to meet the requirement, in order to prevent criminals, corrupt government officials and terrorists from using real estate purchases to launder funds.
Doing so would close a loophole that allows attorneys to advise clients without meeting the same reporting requirements as banks and would help prevent potentially illicit funds from making their way into real estate markets, Maloney said. But it also has the potential for putting attorneys in the uncomfortable position of reporting clients to the government in cases where there may not be a criminal violation, said Marc Landis, the managing partner of Phillips Nizer LLP.
“This will certainly be an area where client confidentiality and attorney-client privilege will be weakened in ways that they have not been previously,” he said.
Lawyers in real estate transactions came under renewed attention after the transparency advocacy group Global Witness and the CBS News program “60 Minutes” released a blockbuster report Sunday night that showed several New York law firms providing information to an individual posing as an adviser to a minister from an African government who was looking to buy a Gulfstream jet, a yacht and a New York brownstone without the money being detected.
According to the report, which used hidden cameras, 12 of 13 lawyers provided assistance when asked how to set up shell companies and other vehicles to avoid attaching a name to the purchases. One of those 12 later said he wouldn’t participate in the transactions.
The Global Witness report found that the attorneys — none of whom signed the group’s investigator as a client — broke no laws in providing the advice they did. And that’s a problem that Maloney wants to address.
“This is unacceptable, criminal, scandalous, and it has to stop,” she said on a conference call with reporters.
The New York Democrat’s solution to the problem is to require states to force attorneys, real estate agents and other advisers on a transaction to include the name of the beneficial owner of an LLC or trust on forms submitted to the state. If the state will not or cannot implement such a system, the Treasury Department, through the Financial Crimes Enforcement Network, would require that disclosure.
In a similar move, FinCEN last month announced that title insurers would temporarily be required to provide the names of beneficial owners of LLCs that high-net-worth individuals use to purchase luxury real estate in Miami and Manhattan without mortgages.
Maloney’s bill, which she is introducing for a third time, will expand such reporting and make it permanent.
“We’re going after the loophole. We’re going after the real estate transactions. We’re going after the realtors and some lawyers that are setting these things up,” she said.
According to Brooklyn Law School professor David Reiss, Maloney’s bill, the Incorporation Transparency and Law Enforcement Assistance Act, has struck a good balance between giving law enforcement the power to root out illicit funds in high-end real estate and not infringing too much on attorney-client privilege.
“The attorney-client privilege is one of the oldest of the privileges recognized by courts, and in the aggregate it provides great benefits to society because it promotes open communications between clients and their lawyers. The privilege is not a shield for illegal behavior, though,” he said.
February 2, 2016 | Permalink | No Comments
Tuesday’s Regulatory & Legislative Roundup
- The Federal Housing Administration has announced its new multifamily insurance rates, which show a reduction encouraging capital financing of affordable apartments.
February 2, 2016 | Permalink | No Comments
Monday’s Adjudication Roundup
- PNC Bank settled for $32.3 million to end class action suit alleging that the Bank overcharged homeowners for force-placed insurance.
- Renters in a class action sue Re/Max Holdings for allegedly stealing tenants’ rent payments and security deposits.
February 1, 2016 | Permalink | No Comments
February 1, 2016
Rigged Justice
By David Reiss
The Office of Senator Elizabeth Warren has released Rigged Justice: 2016 How Weak Enforcement Lets Corporate Offenders Off Easy. The Executive Summary states,
When government regulators and prosecutors fail to pursue big corporations or their executives who violate the law, or when the government lets them off with a slap on the wrist, corporate criminals have free rein to operate outside the law. They can game the system, cheat families, rip off taxpayers, and even take actions that result in the death of innocent victims—all with no serious consequences.
The failure to punish big corporations or their executives when they break the law undermines the foundations of this great country: If justice means a prison sentence for a teenager who steals a car, but it means nothing more than a sideways glance at a CEO who quietly engineers the theft of billions of dollars, then the promise of equal justice under the law has turned into a lie. The failure to prosecute big, visible crimes has a corrosive effect on the fabric of democracy and our shared belief that we are all equal in the eyes of the law.
Under the current approach to enforcement, corporate criminals routinely escape meaningful prosecution for their misconduct. This is so despite the fact that the law is unambiguous: if a corporation has violated the law, individuals within the corporation must also have violated the law. If the corporation is subject to charges of wrongdoing, so are those in the corporation who planned, authorized or took the actions. But even in cases of flagrant corporate law breaking, federal law enforcement agencies – and particularly the Department of Justice (DOJ) – rarely seek prosecution of individuals. In fact, federal agencies rarely pursue convictions of either large corporations or their executives in a court of law. Instead, they agree to criminal and civil settlements with corporations that rarely require any admission of wrongdoing and they let the executives go free without any individual accountability. (1)
I think the report’s central point is that the “contrast between the treatment of highly paid executives and everyone else couldn’t be sharper.” (1)
The report does not address some of the key issues that stand in the way of achieving substantive justice for financial wrongdoing. First, many of those accused of wrongdoing were well-represented by counsel who ensured that they did not violate any criminal laws, even if they engaged in rampant bad behavior. Second, contemporary jurisprudence of corporate criminal liability presents serious roadblocks to prosecutors who seek to pursue such wrongdoing. Third, many of these cases are incredibly resource heavy, even for federal prosecutors. This can incentivize them to go after other types of financial wrongdoing instead, such as insider trading.
It seems like it is too late to address much of the wrongdoing that arose from our most recent financial crisis. But if this report achieves one thing, I would hope that it gets Congress to focus on how corporations and their high-level executives could be held criminally accountable the next time around.
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February 1, 2016 | Permalink | No Comments