The Chaos of 12 U.S.C. Section 1821(K): Congressional Subsidizing of Negligent Bank Directors and Officers?

66 Pages Posted: 5 Aug 2010

See all articles by Steven A. Ramirez

Steven A. Ramirez

Loyola University of Chicago School of Law

Date Written: November 15, 1995

Abstract

Relieving bank managers from traditional liability for negligence is contrary to the legislative and executive intent in passing FIRREA and economically suboptimal. Misinterpreting FIRREA to permit negligent management of banks will create perverse incentives for excessive bank risks and lead to more taxpayer funded bank bailouts that could impose trillions in costs.

JEL Classification: E53, G18, G28, G38

Suggested Citation

Ramirez, Steven A., The Chaos of 12 U.S.C. Section 1821(K): Congressional Subsidizing of Negligent Bank Directors and Officers? (November 15, 1995). Fordham Law Review, Vol. 65, p. 625, 1996. Available at SSRN: https://ssrn.com/abstract=1652976

Steven A. Ramirez (Contact Author)

Loyola University of Chicago School of Law ( email )

25 E. Pearson
Chicago, IL 60611
United States

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