by Brian Mahany
The lead editorial in today’s Wall Street Journal was titled, “Where Are The criminals?” The editorial that followed suggested that the Obama Administration wasn’t successful in prosecuting those responsible for the financial crisis. With that much, we agree.
Some 4 years later, almost no one has been successfully prosecuted for the untold trillions lost when the housing market crashed. The Journal believes that prosecutors have met with failure because they were “trying to find criminality among bankers who were doing what everyone was doing.” That’s where we disagree.
Justice Department lawyers are some of the brightest and best in the business. Virtually everyone there could make at least twice the money in private practice yet the government still is able to attract and retain great lawyers. So why can’t these great lawyers get convictions?
Our answer is simple. Because the political interests in Washington have become too intertwined with the banking industry. When investment banks become “too big to fail,” they also become too big to prosecute.
With a few exceptions – our friends in Preet Bahara’s office come to mind – most United States Attorneys don’t have the stones to take on the Wall Street titans and their leaders. Instead, we have a pattern of SEC actions that result in consent orders, large fines and absolutely no admission of wrongdoing. With the exception of some inside traders, no one really has gone to jail for their personal role in bringing down the nation’s economy.
If you fail to pay $50,000 in taxes, expect to spend some time in prison. But if your name is Frank Mozilla or one of the other banking elite, the worst that may happen is your bank having to pay a steep fine.
Perhaps, as the WSJ editorial suggests, the banking elite have not done anything wrong. We have seen too much fraud to believe that, however.
While Washington’s political elite does share some of the blame, we think all the guilty parties should be held accountable. Whether a regulator, Congressman or banker… if you broke the law you should be held to answer. As long as the 94 U.S. Attorneys are essentially political appointees, don’t expect that too happen soon.
We believe the only way to clean up Wall Street is through the courts where a jury can decide. And the best way to get cases before a jury isn’t waiting for the Justice Department, it’s through false claims actions (whistleblower cases) and shareholder class actions. It’s not a surprise that the largest pending civil case against a lender (and most of the other big cases) were initiated by whistleblowers; ordinary workers that had enough of the greed and corruption that plague Wall Street.
If you have inside information about fraud or misconduct by a bank, loan servicer or mortgage company, give us a call. We can quickly determine whether you have a potential case and may be eligible to a sizable cash award.
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine and Minneapolis, Minnesota. Services available in many jurisdictions.