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PBS Frontline: The Untouchables

Thursday, January 24, 2013 - 6:45 AM
I haven't had time to watch this yet, but it looks interesting:
FRONTLINE investigates why Wall Street’s leaders have escaped prosecution for any fraud related to the sale of bad mortgages.

It can be viewed online at this PBS Frontline page.
4
Ken TuminKen Tumin5,469 posts since
Nov 29, 2009
Rep Points: 125,053
1. Thursday, January 24, 2013 - 7:55 AM
Doubts raced through my mind as I considered the feasibility of a law which the majority of dishonest citizens didn't seem to want.

4
elioteliot1 posts since
Jan 24, 2013
Rep Points: 4
2. Thursday, January 24, 2013 - 8:06 AM
Why Goldman Sachs, Other Wall Street Titans Are Not Being Prosecuted

Why is that? In a word: cronyism.

Why Goldman Sachs, Other Wall Street Titans Are Not Being Prosecuted - The Daily Beast

 
2
ShorebreakShorebreak2,607 posts since
Apr 6, 2010
Rep Points: 14,112
3. Thursday, January 24, 2013 - 8:53 AM
From Consumerist:
Less than 24 hours after his appearance on PBS’ Frontline, where he struggled to explain why his office had brought not one single indictment against a high-level Wall Street executive related to the 2008 financial crisis, Assistant Attorney General Lanny Breuer has reportedly decided to step down.

Read more

If only indictments had come with this speed.... or even at all...
5
pearlbrownpearlbrown1,431 posts since
Nov 2, 2010
Rep Points: 6,248
4. Thursday, January 24, 2013 - 6:26 PM
I am not happy with our megabanks and their handling of the mortgage crisis, but that doesn't mean I want people indicted if the govt doesn't have adequate proof that crimes were committed. Just to go after people to satisfy the mob's thirst for blood is a very poor reason to send people to jail. I don't want to live in a country where your 5th Amendment  rights are not sacrosanct. If a crime was committed and you can PROVE it, then prosecute. Otherwise, just because you feel these people got away with something is not sufficient reason to go after them.
1
loulou543 posts since
Aug 3, 2010
Rep Points: 3,392
5. Friday, January 25, 2013 - 7:55 AM
I agree that mob rule is not a replacement for our system of justice.    However, from the Consumerist article:
Breuer and his office have been criticized for not having confidence in the mountain of evidence — turned up by regulators, lawmakers, the Financial Crisis Inquiry Commission, and dozens of private lawsuits against banks — that shows bank executives were complicit in fraud related to toxic mortgages and the mortgage-backed securities created from them.

If the evidence is not enough or is inadequate then that needs to be understood and explained.


 

3
pearlbrownpearlbrown1,431 posts since
Nov 2, 2010
Rep Points: 6,248
6. Friday, January 25, 2013 - 4:09 PM
Sometimes it is hard to differentiate fraud from stupidity or greed. There are many to blame for the mortgage credit fiasco, including the thousands (maybe millions) of homeowners who lied on their loan applications. I would say the govt is just as complicit as Wall Street for the massive amount of toxic mortgage securities. The govt housing agencies (Fannie Mae) lost  more money than anyone in the private sector for their loose underwriting practices. Our congressional representatives and regulatory agencies had ample opportunity to intervene and fix the problem at an earlier stage before it got out of control. How come no one is suggesting they should go to jail. It is very easy to scapegoat Wall Street (everyone loves to hate them) but, truth be told, the origins for and lessons learned from the mortgage debacle are far more complicated than sending a few people on Wall Street to jail. 

I noticed lately that a number of people on Wall Street are getting 40 to 50 year jail sentences for insider trading. I would say this has got to be disproportionate when you have many murderers and rapists getting more lenient sentences. I want justice, not political grandstanding.
1
loulou543 posts since
Aug 3, 2010
Rep Points: 3,392
7. Thursday, January 31, 2013 - 11:01 AM
It's not just that million-dollar-plus campaign contributions likely dampen a fair amount of prosecutorial zeal (reference article posted by Shorebreak in #2 post).  Accodrding to an article from The Fiscal Times ("Jail Them Or Nail Them - Was Justice Served On The Banks?"), it's also the fact that Holder and Breuer were
partners for years at a Washington law firm that represented a sort of ‘Who's Who’ of big banks and other companies at the center of alleged foreclosure fraud, according to a report last year by Reuters. The firm, Covington & Burling, is one of Washington's biggest white shoe law firms, and law professors and other federal ethics experts said that federal conflict-of-interest rules required Holder and Breuer to recuse themselves from any Justice Department decisions relating to law firm clients they personally had done work for.

Read more

I agree that many people/organizations missed the opportunity to intervene and fix the problem early on before it got out of control.  Unfortunately if we brought to justice every one who was involved in the crisis, and those who should have detected it and didn't, it would look like a neutron bomb had exploded:  buildings in Washington and across the country would be left standing but they would be empty.    That doesn't absolve the people with the responsibility of prosecution from doing their jobs, and furthermore it helps tremendously if they did not previously profit financially from those who are now being investigated. 

As far as the apparent disproportion of sentences (40-50 years for insider trading vs occasionally more lenient sentences for murderers and rapists), I would agree that unfortunately the law is not 100% perfect all the time.  The magnitude of the pain experienced by the victims/families/loved ones of crimes such as murder and rape is simply unfathomable.   No one argues that crimes such as murder and rape are on the same level as financial misdeeds.   But the individual impact and lasting effects of the financial destruction caused by the mortgage debacle should not be underestimated either.  We the People deserve justice and an explanation of failed prosecution as would be offered in other instances. 

 

Note:  Edited @ 1103 to identify the source and title of the article linked
3
pearlbrownpearlbrown1,431 posts since
Nov 2, 2010
Rep Points: 6,248
8. Thursday, January 31, 2013 - 1:53 PM
Pearlbrown, I have no problem punishing those people who actually committed CRIMES, where it can be proved in a court of law, but I don't like going after certain people because they are unpopular with the populace or because it furthers the political career of a highly ambitious district attorney. I also don't like overcharging white collar crimes because it is politically attractive, but is totally disproportionate to the crime committed. No way anyone should receive a 40 year sentence for insider trading. Taking away someone's freedom is an awesome responsibility and there are several constitutional safeguards protecting every American from capricious and popular sentiment. It is what makes us different from most countries in the world.
1
loulou543 posts since
Aug 3, 2010
Rep Points: 3,392
9. Thursday, January 31, 2013 - 2:20 PM
Lou, I am not suggesting going after people because they are popular whipping boys or because it furthers anyone's career.   All I am saying is that at least the evidence should be examined objectively, and there is no way that a prosecutor who has previously profited to some extent by association with the parties under investigation can be perceived to be objective.  

As far as the overcharging of some crimes (and undercharging of others), as I have already commented, unfortunately the law is not perfect or consistent 100% of the time.    That does not mean the system is broken, only that it is in imperfect hands because we are all imperfect.  Nonetheless I would not want to live under any other. 
3
pearlbrownpearlbrown1,431 posts since
Nov 2, 2010
Rep Points: 6,248
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