"Financial Economics"

Financial Economics

With years of combined experience as academics, consultants, and regulators in financial economics, CRA’s financial economics experts have been retained as consulting and testifying experts in a wide variety of financial economics regulatory, consulting, and litigation matters, including fair lending compliance, credit risk, automobile lending, credit cards, debit cards, credit scoring, interchange fees, mortgage lending, international mortgage markets, and securitization.

Competition

CRA is an acknowledged leader in providing economic analysis, advice, and testimony for antitrust and merger cases worldwide. We combine expertise in competition economics with an insider’s grasp of the financial services sector to address competition concerns among its participants. For mergers of depository institutions, CRA experts analyze geographic market definition and calculate market shares based on deposits. 

Consumer finance litigation

CRA has more than 15 years of experience working on issues related to consumer finance litigation, developing and conducting the statistical analyses necessary to detect lending disparities or to refute allegations of discrimination. CRA has analyzed pricing, underwriting, and credit scoring models, and we have proxied race and ethnicity using multiple methodologies including geocoding of tract and census tract proportions of minority population status, ethnicizing by surname for Hispanic borrowers or using genderizing software to distinguish male from female borrower outcomes. These methods have been accepted by the financial regulators with oversight of these banking institutions.

Financial services litigation

CRA has more than 20 years of experience with high profile, complex financial litigation matters. We have supported counsel in all phases of litigation, including class certification, fact discovery, loss causation/materiality, damages, and settlement/mediation. Our projects have involved underwriters, financial institutions, securities, derivative transactions, solvency, and bankruptcy. 

International arbitration

CRA has extensive expertise in international arbitration assignments in the context of both contractual and treaty claims. We have been engaged by parties involved in some of the most complex, high-profile disputes of recent years. Our experts help clients and counsel assess causation and quantify damages by applying sophisticated modeling and analytical techniques. We then present our findings in a way that is clear and compelling to arbitration authorities.

Mortgage finance litigation

CRA has testified in several class action matters involving the origination or securitization of mortgage loans. These matters involved subprime lending, option ARM loans, reverse mortgages, forced place insurance, joint ventures, discrimination allegations, insurance claims on FHA loans, and residential mortgage-backed securities. CRA has the expertise needed to estimate predicted application outcomes and loan prices, determine average expected fees for loan originations, and calculate economic damages associated with any disparities in pricing or fees in both single and multi-plaintiff matters.

Regulatory review and compliance 

Our experts evaluate proposed legislation and determine its economic impact. CRA also helps the legal counsel of financial institutions manage exposure to compliance issues, including discriminatory pricing, steering, and redlining on the basis of race and national origin. CRA recently helped two global financial institutions implement their compliance, risk, and audit functions with respect to financial industry regulations. These assignments incorporated numerous federal and state regulations such as the CFPB, BSA, FCRA and UDAAP, and also included a focus on anti-money laundering internal controls and precise work plans.