Earlier today, Paula Dubberly, Associate Director (Legal) of the Division of Corporation Finance of the Securities and Exchange Commission (the “SEC”), spoke on a panel entitled “Regulation AB and Offering Process Reform Implementation” at the American Securitization Forum’s 2007 conference in Las Vegas, Nevada. Ms. Dubberly specifically addressed Item 1122 assessments with respect to vendors, SEC review of Form 10-K filings and the use of websites for static pool disclosure. Ms. Dubberly prefaced her presentation by reminding the audience that her remarks are her own views and do not necessarily represent the position of the SEC.

A. Item 1122 Assessments With Respect To Vendors

During the presentation, Ms. Dubberly addressed an interpretive request to the SEC contained in a letter jointly submitted by the American Securitization Forum and the Mortgage Bankers Association regarding the availability of a “responsible party” concept under Item 1122 of Regulation AB and Rules 13a-18 and 15d-18 under the Securities Exchange Act of 1934. The joint submission requested the SEC to provide guidance on whether a “servicer” (as defined in Item 1101(j) of Regulation AB) could take responsibility for assessing compliance by a “vendor” with the servicing criteria set forth in Item 1122(d) of Regulation AB. A vendor is a term often used to describe an entity that is engaged by a servicer to perform limited roles with respect to the assets in a pool (an example discussed by the panel was a lockbox provider in a residential mortgage securitization transaction).

Ms. Dubberly indicated that there may be instances where a servicer, in lieu of obtaining an Item 1122 assessment from a vendor engaged by such servicer, could elect to assume responsibility for providing the Item 1122 assessment with respect to the servicing criteria applicable to such vendor’s activities. Ms. Dubberly identified the following conditions that must be present in order for a servicer to be able to assume the Item 1122 reporting responsibility for a vendor’s activities:

- the vendor’s activities are limited and/or scripted;

- the vendor does not fit the definition of a “servicer” under Item 1101(j); and

- the servicer maintains, during the entire reporting period, policies and procedures designed to provide reasonable assurance that the vendor’s activities comply with the servicing criteria applicable to such vendor.

Ms. Dubberly noted that such a servicer assessment must disclose (i) the specific servicing criteria applicable to the vendor that the servicer is assuming responsibility for, (ii) material noncompliance with such servicing criteria by the vendor and (iii) deficiencies in the servicer’s policies and procedures for monitoring the vendor. She also emphasized that, not only must the servicer have policies and procedures in place to reasonably assure vendor compliance, such policies and procedures must be operating effectively during the reporting period. It was not entirely clear from the panel discussion whether the latter standard requires more than the disclosure of deficiencies in the servicer’s policies and procedures in its assessment of compliance. Presumably, any remaining questions will be clarified when the SEC formally announces its position. Ms. Dubberly indicated that the SEC will likely issue a telephone interpretation regarding Item 1122 assessments covering the activities of vendors within the next two weeks.

B. Form 10-K Filings

Ms. Dubberly also announced today that the SEC would be performing focused reviews on Form 10-Ks of ABS issuers that are filed this year. She indicated that unlike ‘33 Act filings, filers will not be notified in advance that they are being reviewed and will only become aware that a review has occurred in the event that the SEC issues such filer a comment letter.

C. Static Pool Information Websites

Ms. Dubberly reminded the audience that the temporary accommodation contained in Regulation AB for providing static pool information on an internet website in lieu of physically including it in a prospectus expires on December 31, 2009. She indicated that the SEC is currently reviewing the efficacy and desirability of providing static pool information in that fashion and may consider whether such accommodation should be made permanent.