Have we learned anything from the Financial Crisis?
I would say nothing at all…. In fact, instead of changing their behavior to prevent another crisis regarding finance, the Powers-that-be seem to be doubling down on the strategies that Caused the Financial Crisis in the First Place
Liberals blame deregulation and reckless Wall Street greed for the economic crisis. Conservatives blame bad government policy.
What are they doing? Well here again…. they are:
1. Pushing banks to make home loans to people with weaker credit (sound familiar?)
2. Deregulating and even promoting insane levels of derivatives (ring a bell?)
3. Following policies which lead to rampant inequality (that didn’t work out so well last time)
4. Letting white collar criminals know that they have free rein to do whatever they want, and they won’t be prosecuted (once again)
5. Letting the giant banks get bigger and bigger (the government helped them get big in the first place)
The independent economic think tank Financial Policy Council (FPC) fears that the business and investing community (not to mention, bank depositors and shareholders) are potential big losers from the Justice Department’s much-trumpeted settlement of civil and criminal charges with J.P. Morgan Chase Bank, N.A. in connection with its activities involving Bernard L. Madoff’s legendary fraud.
We wish we did not have to emphasize the criminality of J.P. Morgan Chase — and we wish it had never occurred — except that the bank itself admitted to this fact. Others can speculate on whether there was arm-twisting or the use of leverage, and even on whether or why other Too Big To Fail banks might be “untouchable.”
We restrain our focus on the hard fact: J.P. Morgan has admitted to criminal wrongdoing, and in so doing has agreed to a massive $1.7 billion penalty and to reform its anti-money laundering funds in order to get a two-year deferred prosecution agreement. The particularized admissions are formidable, as contained in the criminal information filed in Manhattan Federal Court (Southern District of New York) by the United States Attorney’s Office.
Criminal wrongdoing needs to be emphasized here, because a criminal act involves criminal intent, that is, willfulness. Here, the bank is charged with having “willfully fail[ed] to establish an adequate money-laundering program” and further having “willfully fail[ed] to report suspicious transactions.”