When the energy giant Enron collapsed 10 years ago, top executives of the company faced criminal prosecution, and many served lengthy prison terms. In the savings and loan scandal of the 1980s, hundreds of bankers went to jail.Gee... why doesn't three-fingered Louie and the Death's Head gang get this same sweet heart deal? Oh... they didn't go to the "right schools" and rub elbows with the up-and-coming like Obama and Eric Holder.
But the financial meltdown of 2008 hasn't generated a single prosecution of high-level Wall Street players — even though the Securities and Exchange Commission has brought civil cases against some companies and reached financial settlements.
That's a result of new guidelines issued by the Justice Department in 2008, which have allowed prosecutors to take a "softer approach" to corporate crimes. The guidelines — known as deferred prosecution agreements — have permitted financial companies to avoid indictments if they agree to investigate and report their own crimes.
"It's a gentlemen's agreement, and it really allows companies to keep their share prices higher and it helps companies continue to do business with the government, but it's a lot lighter [in terms of penalties,]" says New York Times financial reporter Louise Story. "And this [approach] was celebrated on Wall Street."
Here's how blind an eye the Justice Department (and SEC) is turning toward the criminal behaviour of the big Wall Street banks:
Only one Goldman Sachs employee — a 28-year-old salesman named Fabrice Tourre — has been sued by the SEC for his role in a toxic mortgage-securities fraud case during the 2008 financial crisis. No criminal charges were filed.The fact that you can line your own pockets with tens of millions of dollars, let your company steal billions, and leave the tab -- several trillion dollars of losses -- to the American taxpayer means that this, or something bigger, is going to blow up in a couple of years. It's like Al Capone shot up the Chicago main police station and the police didn't charge anybody. That simply means that Capone would be more than happy to shoot up the central police station again and again. There is no consequence for the lawlessness.
"We were told by a lot of current and former Goldman people that there were a large team of people involved, and in fact, since then many Goldman employees and former employees have told us that they were so surprised that only Fabrice was named," Story says. "Fabrice himself thinks it was a little odd that he was the only one named. And we recently obtained the private reply that Fabrice sent to the SEC trying to convince them that he should not be the only one named. And in the reply, he laid out all kinds of people — six or seven other people — who were just as involved in all of the activities as he was."