Share the article
twitter-iconcopy-link-iconprint-icon
share-icon
AmericasMarch 2 2003

Banks under legal siege

Wall Street banks are facing damages to the tune of $25bn but are reluctant to set aside reserves as they fear it may encourage new claims. Suzanne Miller reports on the legal battle that threatens to spread overseas.
Share the article
twitter-iconcopy-link-iconprint-icon
share-icon

If Wall Street banks thought they had put the worst behind them when they shut the door on 2002, think again. Yes, many were vilified and bled of earnings because of their role in some of history's worst corporate failures. But 2003 could be a year of legal reckoning - the lawyers' ballroom dance on the corporate carnage still strewn across the marketplace.

An army of lawyers representing scores of banks and thousands of plaintiffs are squaring off for a battle where tens of billions of dollars in claims are at stake. Banks are already reforming research practices thanks to regulators, but the next big challenge is surviving a five-front legal war that could leave Wall Street short of billions of dollars. At the very least, many will stagger away from the boxing ring with torn pinstripe lapels, bruised knuckles and hefty legal bills.

To continue reading, join our community and benefit from

  • In-depth coverage across key markets
  • Comments from financial leaders and policymakers worldwide
  • Regional/country bank rankings and awards
Activate your free trial