If anyone in America still has faith in the quaint notion, enshrined in the Pledge of Allegiance, that we live in a country where there is “justice for all,” it should have been put to rest last week. That’s when U.S. Attorney General Eric Holder, the country’s chief law enforcement officer, admitted to a Senate banking committee that the Justice Department now believes that too-big-to-fail banks are also too-big-to-jail:
“The size of some of these institutions [is] so large that it does become difficult for us to prosecute them . . . [and] if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy.”
Holder’s admission came just a few weeks after Lanny Breuer, the recently departed assistant attorney general for the Justice Department’s criminal division, admitted that even though large British Bank HSBC confessed that it broke several U.S. laws by laundering money for parties in Iran and Libya on behalf of Mexican drug lords, it too will escape criminal prosecution:
“Had the U.S. authorities decided to press criminal charges, HSBC would almost certainly have lost its banking license in the U.S., the future of the institution would have been under threat and the entire banking system would have been destabilized.”
The Justice Department Tosses in the Towel
So there you have it: tacit confirmation from the government’s top two law enforcers that if you are one of the planet’s major money movers, you can ride roughshod over any law, regulation or legal limit to your activities.
The big banks are now the new “Untouchables,” their very size insulating them from any repercussions for criminal behavior.
No matter that the financial collapse and the economic crisis that started in 2007 largely because of the reckless actions of these same Wall Street banks will cost the country more than $12.8 trillion between 2008-2018. Don’t take my word for it, that’s according to a report by the non-profit, non-partisan organization, Better Markets.
No matter that an “epidemic of fraud” (the FBI’s words) created a giant sinkhole in the American economy, taking millions of John and Jane Does down with it.
No matter that the big banks engaged in schemes and scams, peddled mortgage securities they knew were garbage, gamed the interest rates for their own profit, laundered drug money, traded with sanctioned countries in contradiction to U.S. statute and illegally threw people out of their homes.
None of it seems to matter – not one CEO, CFO, bank president or financial officer has been jailed, much less arrested or indicted.
In fact, in the five years since the economy imploded, virtually nothing has changed: big banks are getting bigger and executive bonuses have also metastasized — all while millions of Americans lost homes, jobs and likely their faith in the nation’s laws and institutions.
Big Banks Will Continue their Bad Behavior
What’s next from the banksters of Wall Street? Well, once you have that get-out-of-jail-free card in your wallet, you’re pretty much incentivized to engage in the same criminal activities that tanked the economy in the first place, aren’t you?
And to add insult to injury, not only will you not be held responsible for your crimes, chances are just as good that if you screw up again — which you will, since nothing has really changed — you will get bailed out once more by a government that has evidently ceded its moral authority to the pursuit of your profligacy.
Two Systems of Justice
The Justice Department’s abdication of its main reason for existing — the enforcement of the law without prejudice — cements the conviction that there are two systems of justice in America: one for the bankers and another one for the rest of us.
So much for justice for all.
Recently, Senator Elizabeth Warren (D-MA) laid bare the yawning gap between who gets busted for crime in America and who gets to walk, when she asked a panel of banking regulators — officials from the Treasury Department, the Federal Reserve, and the Office of the Comptroller of the Currency — why they all failed to shut down crooked banks.
Their answer was that their hands were tied. The Justice Department, they said, has not convicted any bank of a crime.
In response, the frustrated senator then pointed out the discrepancy between law enforcement’s vigorous prosecution of drug offenses as opposed to its lax pursuit of white collar criminality.
“If you’re caught with an ounce of cocaine, the chances are good you’re going to go to jail. If it happens repeatedly, you may go to jail for the rest of your life. But evidently if you launder nearly a billion dollars for drug cartels and violate international sanctions, your company pays a fine and you go home and sleep in your own bed at night. . . . [T]hat’s fundamentally wrong.”
Yes, senator, it is fundamentally wrong that breaking the law in America is OK for some and not for others.
It is fundamentally wrong that certain individuals who commit criminal acts can hide behind the corporate skirts of the big financial institutions that employ them and thereby escape punishment.
It is fundamentally wrong, and it spells the end of equality under the law in America.
Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it in 2012, helping birth Debt.org into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering the high finance world of college and professional sports for major publications, including the Associated Press, New York Times and Sports Illustrated. His interest in sports has waned some, but he is as passionate as ever about not reaching for his wallet. Bill can be reached at [email protected].