Members Said to Pull Out of Securitization Lobby Over Governance

The American Securitization Forum, the leading trade association for the securitization industry, fell into turmoil last week when most of the board resigned in a dispute with the group’s executive director over governance and bonuses, according to six people familiar with the matter.

The exodus puts the future of the trade group in question, said the people, who spoke on condition of anonymity because the dispute isn’t public. Members that quit include Bank of America Corp., JPMorgan Chase & Co., Deutsche Bank AG, Citigroup Inc. and law firm Cadwalader, Wickersham & Taft LLP, the people said.

The resignations came after the board attempted to remove the forum’s executive director Tom Deutsch, but was unable to fire him because of the way the association’s governing documents are written, said the people. Part of the dispute concerns bonuses that Deutsch was paid, the people added.

Deutsch didn’t return telephone and email messages seeking comment. Jon Teall, a spokesman for the group at Teall & Associates, declined to comment.

Zia Ahmed, a spokesman for Bank of America, confirmed that the bank quit, declining to comment further. Spokespeople for other board members either declined to comment or couldn’t immediately be reached.

ASF, based in New York, lobbies and holds conferences for the industry, which packages loans and leases into securities. Last year that produced more than $500 billion of new bonds globally.

In testimony to Congress last year, Deutsch said the forum had 330 members. According to the group’s website, members include a range of players in the securitization industry including issuers, investors, financial intermediaries, rating agencies, legal and accounting firms, trustees, servicers and guarantors.