A growing conflict in Wall Street buyouts

New York

IT goes by a rather innocuous-sounding name, the sort of phrase you might breeze past in a loan document: "designated lender counsel". But pay attention, because it's the latest conflict-ridden practice on Wall Street.

Over the last several years, a new, insidious relationship has quietly developed between the nation's largest private equity (PE) firms, the banks that lend them billions to fund their buyouts, and the law firms that advise on these deals.