Editor's Note: Though Hank Paulson is not involved in this story, he remains guilty of crimes against humanity and taxpayers. Call it Daily Bail subliminal messaging, only less subliminal and more of a 'headline lead.' Paulson's crimes are outlined here.
It's long past time for jail sentences and orange jumpsuits.
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By Shahien Nasiripour
Wall Street Prosecutions Slow to Develop
NEW YORK -- After the last major banking crisis, some two decades ago, roughly 3,800 bankers were prosecuted and sentenced to prison terms, by the Justice Department's count. Yet this time, some four years after the economy descended into the most punishing financial crisis since the Great Depression, the public still waits for the Obama administration to deliver a similar kind of justice.
The 2007-'09 financial crisis was "avoidable," a bipartisan, congressionally-appointed panel concluded last week. Mortgage fraud "flourished" in the run up to the collapse. Securities fraud was apparently widespread.
"Lenders made loans that they knew borrowers could not afford and that could cause massive losses to investors in mortgage securities," the Financial Crisis Inquiry Commission wrote in its report on the causes of the collapse. About $1 trillion worth of home loans made from 2005 to 2007 were "fraudulent," the commission said, citing testimony from experts. The Illinois Attorney General, Lisa Madigan, told the commission that she defined fraud to include lenders' "sale of unaffordable or structurally-unfair mortgage products to borrowers."
And yet, the perp walk so many Americans crave -- Treasury Secretary Timothy Geithner once referred to it as the "very deep public desire for Old Testament justice" -- hasn't occurred. Wall Street figures have largely gone untouched. Bank directors kept their jobs. In a sign that perhaps the fallout from the crisis has passed, outsized compensation is back.
"People need to go to jail," said Liz Ryan Murray, policy director of National People's Action, an advocacy organization that helped launch the website CrimeShouldntPay.com. "If you steal something, you go to jail. If you falsify documents, you go to jail. Why doesn't that apply to big bank executives?"
Officials from the Department of Justice and the Securities and Exchange Commission have been asked those questions before -- often during testimony before various congressional panels. DOJ prosecutes crimes, while the SEC files civil cases, though it can also refer cases to Justice for criminal prosecution.
But those powers haven't been used enough, experts say. The law-enforcement agencies suffer from a lack of combativeness. They're handicapped by the fact that they're looking at potential violations not while they're in the act, but long after they were committed. And they deal with complicated transactions that could be difficult to explain to juries, rendering their efforts to take cases to trial more challenging.
Continue reading at Huff Po...
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