Law professors are beginning to get to grips with the massive amount of wrongdoing at American financial institutions. Here’s part of the abstract for Gregory M. Gilchrist’s article on “The Special Problem of Banks and Crime:”
Federal prosecutors face increasing criticism for their failure to indict large banks and bankers for serious criminal conduct, including allowing violent drug cartels to launder hundreds of millions of dollars, willfully conducting business with rogue nations and terrorists, and manipulating the LIBOR to defraud investors. This Essay argues that the non-prosecution of banks is often justified by proper consideration of externalities and that the non-prosecution of bankers is often justified by lack of evidence. Nevertheless, the result is that extremely serious criminal conduct is penalized by mere fines and negotiated terms of probation, and this introduces deterrence and expressive costs to the legal system.
The idea that “non-prosecution of bankers is often justified by lack of evidence” is particularly interesting in a post-fusion center, post-PRISM world. If robbery suspects are demanding NSA phone records for exoneration, how soon might authorities consult them to finger paladins of peculation?
This is part of a series on crime and scandal at financial institutions. Prior posts include: