Attorney General Eric Holder made a shocking admission to Congress on March 6:
“I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy.”
With these words, Holder confirmed the assumption many had made about why not one Wall Street executive was in jail for crimes related to the financial crisis: Not only are America’s banks “too big to fail” — bigger now than before the taxpayers had to bail them out –they’re also “too big to jail.”
Holder’s admission seemed to enrage freshman senator Elizabeth Warren (D-MA), who as a consumer advocate and a TARP watchdog has long been at odds with the big banks — which opposed both her nomination to lead the Consumer Financial Protection Bureau she created and her election to the Senate. The next day, she challenged Treasury officials to define a standard for shutting down banks that participate in drug laundering.
Warren’s efforts are not going unnoticed by Wall Street. “Bankers are bracing for the start of more severe anti-money laundering exams as regulators rework their standards and prepare to issue another round of guidance tackling the issue,” American Banker magazine reported last week.
But Warren’s focus isn’t just laundering, it’s the size of the banks that troubles her most.
In a post on her blog, Warren recently wrote, “When banks are too big to fail, too big to jail, too big for trial, too big to manage, too big to regulate, too big to shrink, and too big to reform… they are just too big.”
And Warren may have some unlikely allies in her efforts — conservatives.
Copyright 2013 The National Memo