Reuters: Bankruptcy News: ResCap examiner bill: $29-36 million

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ResCap examiner bill: $29-36 million Aug 6th 2012, 21:35 Mon Aug 6, 2012 5:35pm EDT * Examiner to review ResCap claims, pre-bankruptcy dealings * Arthur Gonzalez expects to need six months for report Aug 6 (Reuters) - The court-appointed examiner reviewing the bankruptcy of mortgage lender Residential Capital LLC, whose parent Ally Financial Inc is owned mainly by taxpayers, on Monday projected it will cost as much as $36 million for him to prepare his report. Arthur Gonzalez, the examiner, said it is difficult to develop an accurate budget at present, but that his work plan "generally follows the format and level of detail" of work by examiners in four large recent bankruptcies: Dynegy Holdings LLC, Lehman Brothers Holdings Inc, SemCrude LP and Tribune Co. "The examiner currently estimates the total fees for the examiner and his advisers will range from $29 million to $36 million, assuming timely cooperation is provided and the report can be timely filed as a result," Gonzalez said in a filing with the U.S. bankruptcy court in Manhattan. Gonzalez said he will advise if costs are expected to vary significantly from this estimate, which he called preliminary. The former chief judge of the Manhattan bankruptcy court again said he expects to need six months to prepare his report. Examiners may investigate allegations such as dishonesty, fraud, incompetence and mismanagement. Gonzalez was retained last month after Warren Buffett's Berkshire Hathaway Inc , a ResCap creditor, sought an examiner to review what it called "potentially improper" pre-bankruptcy transactions between ResCap and Ally. Jenner & Block, the law firm chaired by Lehman examiner Anton Valukas, was awarded $58.4 million of fees through January for its work on that investment bank's Chapter 11 case, according to a regulatory filing. Once part of General Motors Corp, Ally put ResCap into Chapter 11 on May 14 as a means to address the unit's mortgage-related liabilities. Ally is roughly 74 percent-owned by taxpayers, and did not file for court protection. The case is In re Residential Capital LLC, U.S. Bankruptcy Court, Southern District of New York, No. 12-12020. Link this Share this Digg this Email Reprints

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