Financial-Fraud Prosecutions at 20-Year Lows
"We are right now in the wake of the large financial crisis....and I think what is interesting is that the Justice Department, by and large, has very much laid off Wall Street as it relates to anything related to the 2008 financial crisis," says Schweizer.
In their article, Boyer and Schweizer highlight findings from the Transactional Records Access Clearinghouse, which show financial-fraud prosecutions are at 20-year lows and down 39% since the Enron and Worldcom scandals of 2003.
That's a stark contrast to the aftermath of the S&L crisis where thousands of prosecutions were brought with a conviction rate of 90 percent.
"During the S&L crisis in the early 1990s there was basically a commitment at the top that said 'look, we have go to go after some of these guys to send a message," Schweizer says. "The largest issue [today], I think, is you have to have the political will at the top" which is why he believes Obama could have issues defending himself against his record with the banks come November.
Schweizer is also "very very doubtful" criminal justice will be served against any large institution for two key reasons:
1.The statute of limitations is running out for bringing cases against wrongful-doing.
2.The revolving door at the Justice Department is alive and well-oiled. U.S. Attorney General Eric Holder, as well as many Justice employees, came from law firms that represented some of the biggest banks on Wall Street. Holder and these employees will presumably one day want to return to these types of high-paying private sector jobs, but it would be much more difficult to do so if they come out hard against firms they once represented and may one day represent again.