“Banks Do Not Commit Misconduct, Bankers Do”
Posted by Larry Doyle on August 21, 2014 8:56 AM |
The Department of Justice is soon expected to announce a $17 billion settlement with Bank of America. Is this justice?
I will defer in writing my own commentary this morning because the words and details on this topic provided by Dean Starkman qualify as a Sense on Cents Instant Classic:
There’s a much deeper problem here, however, and one that has received far less attention: Not only has the Department of Justice (DOJ) failed to build any criminal cases for financial-crisis misdeeds, but it’s also now settling with these banks without even filing civil complaints.
A complaint is the cornerstone of civil litigation, the foundation for even routine lawsuits. One of its primary benefits—and of adversarial legal proceedings generally—is that a complaint can bring huge amounts of previously undisclosed information into the public record. In these mortgage securities cases, the Justice Department had not only an obligation but an opportunity: to show the country what it found, to deter future misconduct, to complete the story of the financial crisis in humanizing, clarifying, searing detail.
And to do all that, the department didn’t need to do anything special. Just what lawyers normally do. Instead, by imposing a fine without documenting the underlying abuses, the Justice Department has permitted the banks, for a price, to bury their sins.
. . . New York’s superintendent of financial services, Benjamin M. Lawsky, made the following observation: “In order to deter future offenses, it is important to remember that banks do not commit misconduct—bankers do.”
After reading Starkman’s piece is there any doubt that the Department of Justice is a misnomer? The fines imposed by DOJ on Wall Street banks are anything but justice.
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