Trust fund settlements are a growing part of the litigation industry. How well they work is another issue.
Public interest groups in Arizona say that a mortgage-fraud trust fund settlement is being abused by the state to divert $ 50 million into the state’s general revenues. Indeed, the groups have filed a lawsuit and the complaint is persuasive. The complaint, motion for tro, and ancillary papers are available here on the web site of The Arizona Center for Law in the Public Interest (ACLPI). The press release summary tells the story and is set out below. According to a popular press article, Arizona’s AG apparently is going to defend against the lawsuit even though he opposed the transfer of money.