I saw this and didn't have time to post an elaborate response. But fortunately someone did my work for me.
At least some of the bigwigs at some of the major dealer/trader banks/departments (which are rightly distinguished from boring old commercial banks) can almost certainly be prosecuted under Sarbanes-Oxley.
Note that the law requires the CEO and CFO (at least) to certify their knowledge of the bank's position and the soundness of its risk practices. Ignorance is no defense: if you didn't know, and you said you did, you're guilty. If you failed to certify, you're guilty.
To this I would also add: criminal prosecution of large chunks of the mortgage origination and securitization industries. The abuse of well-established real estate law (i.e. blowing it off completely) in the securitization and transfer of mortgages is well established and quite widespread, if you read past the MSM version of the situation (a few isolated incidents, my ass). If the (again, well established) laws are taken at all seriously, then quite a few individuals are guilty of selling things as mortgage-backed securities which were nothing of the sort: the transfer of the note was not done according to the law, and so it is invalid, and so the MBS is in fact just an empty piece of paper. So there should be some good opportunities for prosecution there.
There is probably also some opportunity to be found by looking for violations of fiduciary responsibility. I am not an expert on the concept, but selling a client a bunch of securities while simultaneously betting against those same securities (i.e. selling short) seems like it would be a violation of fiduciary responsibility. Perhaps not (in which case, we need to update the definition), but hey, we've got plenty to work with in the first two categories.
All this would be expensive and time consuming, and certainly be a net money loser for the DOJ and everyone else involved - I have no pretense that the fines and clawbacks would be even close to covering the cost of prosecution. But that's not the point. The point is to remind these "masters of the universe" that they are not above the law.
Except that they are. As recent events have made apparent. Welcome to the Plutocratic States of America. Your servant's livery will be delivered shortly.
no subject
At least some of the bigwigs at some of the major dealer/trader banks/departments (which are rightly distinguished from boring old commercial banks) can almost certainly be prosecuted under Sarbanes-Oxley.
Note that the law requires the CEO and CFO (at least) to certify their knowledge of the bank's position and the soundness of its risk practices. Ignorance is no defense: if you didn't know, and you said you did, you're guilty. If you failed to certify, you're guilty.
To this I would also add: criminal prosecution of large chunks of the mortgage origination and securitization industries. The abuse of well-established real estate law (i.e. blowing it off completely) in the securitization and transfer of mortgages is well established and quite widespread, if you read past the MSM version of the situation (a few isolated incidents, my ass). If the (again, well established) laws are taken at all seriously, then quite a few individuals are guilty of selling things as mortgage-backed securities which were nothing of the sort: the transfer of the note was not done according to the law, and so it is invalid, and so the MBS is in fact just an empty piece of paper. So there should be some good opportunities for prosecution there.
There is probably also some opportunity to be found by looking for violations of fiduciary responsibility. I am not an expert on the concept, but selling a client a bunch of securities while simultaneously betting against those same securities (i.e. selling short) seems like it would be a violation of fiduciary responsibility. Perhaps not (in which case, we need to update the definition), but hey, we've got plenty to work with in the first two categories.
All this would be expensive and time consuming, and certainly be a net money loser for the DOJ and everyone else involved - I have no pretense that the fines and clawbacks would be even close to covering the cost of prosecution. But that's not the point. The point is to remind these "masters of the universe" that they are not above the law.
Except that they are. As recent events have made apparent. Welcome to the Plutocratic States of America. Your servant's livery will be delivered shortly.