4 ms·

> As to the financial sector, while it is obviously difficult to prosecute many financial crimes, I am not convinced that this is the primary explanation for th

by tomp 12y ago

> As to the financial sector, while it is obviously difficult to prosecute many financial crimes, I am not convinced that this is the primary explanation for the shortage of convictions lately. One of the primary explanations is that banks have become "too big to fail", and if you criminally charge a bank, you effectively make it fail. Basically, banks are powerful enough to get away with murder. http://www.theguardian.com/business/2012/dec/11/hsbc-fine-prosecution-money-laundering http://www.theguardian.com/business/2012/dec/11/hsbc-fine-pr... "Had the US authorities decided to press criminal charges, HSBC would almost certainly have lost its banking licence in the US [...] The bank processed cash for Mexico's Sinaloa cartel, regarded as the most powerful and deadly drug gang in the world, among others."

leoc 12y ago
That doesn't explain the non-prosecution of individual bank employees and officers though. In fact, if one accepts the TBTF argument, then the prosecution of individuals becomes even more important: because it is still perfectly possible to prosecute individual members even if the institution is (we assume for the sake of argument) untouchable, then it is the only way remaining to restrain the behaviour of the institution.
toomuchtodo 12y ago
> One of the primary explanations is that banks have become "too big to fail", and if you criminally charge a bank, you effectively make it fail. Basically, banks are powerful enough to get away with murder. So give the FDIC more power and a larger fund to draw on for bank failures. They already handle bank failures very very well, they'd be fantastic at spinning down banks accused and convicted of criminal activities. We dismantled Arthur Anderson for their complacency in the Enron criminial enterprise. Why not banks?
- rayiner 12y ago
  > We dismantled Arthur Anderson for their complacency in the Enron criminial enterprise. Why not banks? And that was a terrible outcome. A huge, $10 billion a year corporation came crashing down, with tons of people losing their jobs, all because of the conduct of one team within the company that the rest of the enterprise had no knowledge of or control over. For a conviction that was overturned on appeal!
  - toomuchtodo 12y ago
    If dismantling the organization isn't an option, and punishing individuals isn't an option due to corporate liability limitations, where does that leave us?

by tomp 12y ago

leoc 12y ago

That doesn't explain the non-prosecution of individual bank employees and officers though. In fact, if one accepts the TBTF argument, then the prosecution of individuals becomes even more important: because it is still perfectly possible to prosecute individual members even if the institution is (we assume for the sake of argument) untouchable, then it is the only way remaining to restrain the behaviour of the institution.

toomuchtodo 12y ago

> One of the primary explanations is that banks have become "too big to fail", and if you criminally charge a bank, you effectively make it fail. Basically, banks are powerful enough to get away with murder. So give the FDIC more power and a larger fund to draw on for bank failures. They already handle bank failures very very well, they'd be fantastic at spinning down banks accused and convicted of criminal activities. We dismantled Arthur Anderson for their complacency in the Enron criminial enterprise. Why not banks?

rayiner 12y ago
> We dismantled Arthur Anderson for their complacency in the Enron criminial enterprise. Why not banks? And that was a terrible outcome. A huge, $10 billion a year corporation came crashing down, with tons of people losing their jobs, all because of the conduct of one team within the company that the rest of the enterprise had no knowledge of or control over. For a conviction that was overturned on appeal!
- toomuchtodo 12y ago
  If dismantling the organization isn't an option, and punishing individuals isn't an option due to corporate liability limitations, where does that leave us?