Mediation and a Federal Bank/Martin Rosenfeld, JD

Posted on May 16, 2019


There has been much discussion recently about the Federal Reserve Bank. Several suggested names were introduced as potential nominees to serve on the Board. In recent weeks, they have withdrawn their names for consideration.

There are actually 12 Districts in the Federal Reserve system. One them is in Minneapolis. I recently came across an article written in May 2009 by Joyce Hoelting (Assistant Director, University of Minnesota Extension Center for Community Vitality)about that Federal Reserve Bank’s program of debt mediation. While the information is more than a decade old, there are important insights about mediation that are found in this article.

In the FLM program(Farmer-Lender Mediation), 2002 cases were opened in 2008. Farmers owed money to lenders, and debt mediation tried to find a workable solution. The rate of settlement that year was approximately 80%. Some of what Ms. Hoelting concluded about mediation process and mediators includes the following:

*Mediators need a strong code of ethical behavior. Trust is the currency of the mediation process.
*Mediators must always appear to be neutral in what they say and do.
*A good mediator ensures that all have an opportunity to be heard.
*A good mediator must facilitate the designation of issues that call out for a solution.
*Mediators must make effort to banish fault-finding from the discussions.
*Mediators must define common goals.
*Mediators need to keep the discussions focused.

Mediation is not a cure-all. It does not always result in a settlement. However,80% success rate on debt mediation cases is a herculean feat. The debt mediation program in MN did a great deal “right”. Mediate don’t litigate.