I'm probably going to take this just couple of steps too far. But it's too hard to resist, and I think its a valid point.
Back in 2007, right-wing water-carrier Dinesh D'Souza made a big splash when he published The Enemy At Home: The Cultural Left and Its Responsibility for 9/11. The title pretty much says it all. Even before the dust at Ground Zero settled, Jerry Falwell blamed the American left for 9/11, shaking his finger and saying "You helped this happen." D'Souza carried it one step further, though, saying that the answer to "Why do they hate us?" is our "excesses," our "gross depravity and immorality," and that the answer is basically to be more like them.
OK. Fine. So what happens if we apply that to "gross depravity and immorality" in our financial sector?
How about Iran, which D'Souza cites in his book as one Islamic country that gets it just about right in terms of "gross depravity and immorality"? How does Iran handle its own banksters?
Simple: hang them. An Iranian court just sentenced four to hang for bank fraud with political implications.
An Iranian court has sentenced four people to death for a billion-pound bank fraud that tainted the government of President Mahmoud Ahmadinejad, according to state media.
Iranians, hit by sanctions and soaring inflation, were shocked by the scale of the £1.7bn embezzlement, which was exposed last year, and by allegations it was carried out by people close to the political elite, or with their assent.
Thirty-nine people were tried for the fraud, the biggest in the Islamic Republic's history. Four of those had been sentenced to hang, the IRNA state news agency reported.
"According to the sentence that was issued, four of the defendants in this case were sentenced to death," prosecutor general Gholam-Hossein Mohseni-Ejei told IRNA.
Two people had been sentenced to life prison terms, and others received jail sentences of up to 25 years, Mohseni-Ejei said. In addition to jail time, some were sentenced to flogging, ordered to pay fines and banned from government jobs.
Now, before anyone gets started down that road, Let me be clear. I am not saying I'd like to see Jamie Dimon at the end of a rope. Nor am I calling for Lloyd Blankenfein to be publicly flogged. But can we at least get some prosecutions? (Mind you, there are some who would, and could probably make a convincing argument.)
For example, apparently the Department of Justice has decided not to prosecute Goldman Sachs.
The U.S. Justice Department won’t pursue criminal charges against Goldman Sachs Group Inc. (GS) or its employees for allegedly concealing that the bank bet against securities related to the housing market that it sold to investors.
The Justice Department, along with the U.S. attorney’s office for the Southern District of New York, had reviewed the possibility of prosecution after the Goldman Sachs deals were faulted in a Senate investigative panel’s report last year.
Prosecutors “determined that, based on the law and evidence as they exist at this time, there is not a viable basis to bring a criminal prosecution with respect to Goldman Sachs or its employees in regard to the allegations set forth in the report,” the Justice Department said yesterday in a statement.
The Senate’s Permanent Subcommittee on Investigations concluded in April 2011 that Goldman Sachs had peddled mortgage- related securities to its clients while failing to disclose that the firm had bet that those instruments would lose value. The investigation pinned much of the blame for the credit crisis on Wall Street banks that earned billions of dollars by enticing clients to buy the risky bonds.
This is the same Goldman Sachs whose record was summed up pretty well by Pro Publica.
April 2003: SEC charges Goldman Sachs over conflicts of interest among its research analysts. The company eventually settled for $110 million in fines and disgorgements.
November 2003: Former Goldman economist John Youngdahl pleads guilty to insider trading. The firm had to pay the SEC $4.2 million over profits it gained from the illegal dealings.
July 2004: Goldman settles with the SEC for $10 million over charges it improperly promoted a stock sale involving PetroChina.
January 2005: Goldman settles with the SEC for $40 million over charges that it violated securities law in promoting initial public offerings.
April 2006: Two former Goldman employees are charged with running an international insider-trading ring while they were at the firm. Eugene Plotkin and David Pajcin, both in their 20s, paid off insiders at other firms and stole early copies of Business Week to get an edge. They also tried (unsuccessfully) to use strippers to get information. Both eventually served jail time.
March 2007: A Goldman subsidiary, Goldman Execution and Clearing, settles with the SEC for $2 million over allegations that faulty oversight that allowed customers to make illegal trades.
March 2009: Goldman Execution and Clearing settles with the SEC for $1.2 million over improper proprietary trading by employees.
July 2009: The SEC charges a former Goldman Sachs trader Anthony Perez and his brother with insider trading based on information Anthony Perez obtained through his job at Goldman Sachs. He was fined $25,000 and his brother more than $150,000.
May 2010: The SEC hits Goldman Execution and Clearing with a $225,000 fine for violating a rule aimed at regulating short selling.
July 2010: Goldman settles with the SEC for $553 million over allegations that it misled investors about the collateralized debt obligation ABACUS 2007-AC1 by not disclosing the involvement of a hedge fund in its creation, or the fact that the hedge fund stood to benefit if the CDO failed. Goldman executive Fabrice Tourre was also charged.
March 2011: The SEC charges Goldman board member Rajat Gupta with insider trading. Gupta allegedly passed on information he learned as a board member to the hedge fund Galleon Group. In October, 2011, he was arrested and hit with criminal charges by the FBI. The case is pending.
September 2011: The SEC charges a Goldman employee, Spencer Midlin, and his father for insider trading based on information Spencer Midlin gained from his position at Goldman Sachs. The two men were ordered to pay $92,000.
February 2012: Goldman Sachs receives notice from the SEC that the agency may bring charges related to mortgage backed-securities.
This is the same Goldman Sachs:
- whose Chief Financial Officer told the Financial Crisis Inquiry Committee "We don't have a derivatives business" — with a straight face.
- that the SEC has charged with fraud in structuring and marketing collateralized debt obligations (CDOs) tied to subprime mortgages;
- that's spent millions lobbying to stop the implementation financial reform;
- that has its own "inside man" — a guy who changed his name before getting the job — protecting Goldman's interests on Rep. Darrell Issa's Oversight Committee;
- that gamed the rules to score a $500 million deal in the Facebook IPO, that looks a lot like the subprime CDO's that blew up the economy in the first place.
- Where executives have "No regrets" about their role in he financial crisis.
This the same Goldman Sachs whose law-breaking gave rise to bi-partisan agreement like Barack Obama only wishes he could achieve.
And it's not just Goldman Sachs, as Richard Eskow points out.
And despite Holder's claims, the convictions obtained over the least three and a half years have been strictly for small fry. The Justice Department hasn't even tried any cases against major financial executives, despite seemingly overwhelming evidence which includes:
The AIG allegations: We used the Levin/Coburn Report to review the list of potential criminal activity in that case here.
GE Capital deceptions: That's the company whose politically-connected CEO was given a Presidential appointment. Referring investigators were stunned to find that no criminal charges would be filed over its fraudulent deception of investors, even though they had identified specific individuals in the accounting department who had cooked GE's books. GE Capital has also been implicated in fraudulent mortgage practices.
Wells Fargo drug-money laundering: That's the case in which bankers laundered money for the Mexican cartels that have killed tens of thousands of people. You know the gangsters we mean - they're the guys who decapitate people.
JPMorgan Chase's "London Whale": With particular concern about the cover-up of billion-dollar losses, with special concerns about CEO Jamie Dimon's statement to investors that its London losses were "a tempest in a teapot." Dimon later admitted he already knew that those losses would be at least two billion. (Making false statements to investors is stock fraud, a crime.)
And there are others, too numerous to mention all of them here: Countrywide. Citigroup. HSBC. The list goes on and on.
In Iran, they hang bankers for stealing the kind of money these guys do away with between bathroom breaks. I'm not saying we should go that route. But maybe we could manage something like a modern day version of the medieval stockade — a long, public trial in which the banks' misdeeds and "shitty deals" are poured over in excruciating detail, for public consumption in the 24-hour news cycle. Heck, there might even be a profit angle in this. With all the material available, there's enough to keep a Court TV-style "financial crimes" network going for years to come.
Think there's no audience for it? Remember this?
Maybe it would be next to impossible to score a "win" by sending a few more people to prison, which richly deserve to go. But how about expanding the definition of "win" here? If you can't put them in in prison stripes:
- humiliate them by repeatedly parading their crimes in public;
- make pariah's of them by publicly counting up their billions in ill-gotten gains in one column, and tallying up the human cost in the other;
- cost them investors and cut into their profit margins by publicizing every detail of the their dirty-deals, and every manifestation of their disdain for their own clients;
- since they can afford to pay millions in fines, and millions more on lobbying, make them spend just as much defending themselves.
Sure, you might not send anyone to prison. But that doesn't mean you can't make them pay, and keep paying. Destroy a few reputations, for every million or so dreams they destroyed at a profit. Ruin a few lives for every life they big bonuses for ruining.
We don't have to follow Iran's example. It's like something I saw on a t-shirt not long ago.
Justice, after all, can take many different forms.
