Thursday, September 10, 2015


In a blatant political move, the administration leaked to the New York Times (more on it later) the text of a speech to be given by the Attorney General, Loretta Lynch, on a change in the Justice Department's strategy for dealing with "white collar crime" which in effect, is to place more emphasis on going after the individuals in a corporation for their wrongdoing through the forcing of the corporation to "give up" their employees rather than just settling for fines against the corporations and in very rare case pleas of wrongdoing.

Having been constantly berated by people on the far left of the party for not jailing the "criminals" in the great financial crisis, this is the solution propose, in a coming election year, to silence the criticism.  It is crap  and a disgraceful misleading of the American public.

Huge damage was done beginning about 10 years ago.  Huge mistakes were made.  Huge losses were suffered but whilst there was corporate wrongdoing and stupidity, was there illegality?  That is a very different question.

To be convicted of a criminal offense, under the laws of the United States, in most case two requirements must be present.  The first if knowledge that one is breaking the law and the other the intent to break the law.  Sounds easy, but it is not.  It is very, very difficult to prove intent, and that hurdle remains despite whatever new thoughts the justice department might have regarding "going after the bad guys."  For all of the noise and nonsense created, this justice department has never successfully prosecuted any individual involved with the financial--not because they it didn't want to but because it couldn't.  In fact the best shot they could have had was Franklin Raines, the former head of Fanny Mae who knowingly and deliberately misrepresented the financial records of the company and was allowed to "retire" with a package somewhere in the rang of $100 million.  Of course, good ol' Frankie was the political insider of all political insiders in the Democratic party and a long term advisor to Il Duce that continues up to the present day.  Not on, old boy, not on, despite Fanny and Freddie being at the very heart of the collapse.

But, the Times puts this on the front page and boy, don't these guys look tough whereas nothing has really changed.  A political grandstand, nothing more except that one can be sure that the white collar lawyers at the nation's big law firms might get a bit busier in the next few months explaining to their clients what all this means...for a fee of course.  Oh, one of the leading firms in this game is the Washington shop, Covington & Burling.  The head of it's white collar practice?  Eric Holder, recently of the Attorney General's office.  You can't make this stuff up.

The big talk on the street today was the apparent confusion and indecision at the Fed as to whether to raise or not next week.  Whether they do or not wasn't the talk, the indecision was.  No surprise, because even I was prepared to concede that they would move until the other day when the word came down from on high via a New York Times editorial that raising interest rates would not be a good idea.  The politicos on the Board are now wringing their hands...Il Duce will be displeased.  Hell of a way to run monetary policy.  I'm tellin' ya, you can't make it up.

No comments:

Post a Comment