May 19, 2014
Despite Credit Suisse Plea, Question Remains: Are Any Banks ‘Too Big to Jail’?
Note: Today, the Department of Justice brought a criminal charge against Credit Suisse of conspiring to aid tax evasion. Below are comments from Public Citizen experts.
“It appears as though the Department of Justice has heard the call to prosecute big banks. This case follows enormous public pressure, including a Senate hearing into Credit Suisse’s widespread abuses. However, an isolated case alone cannot refute the prevailing concern that justice applies unequally in the case of large financial institutions. The Department of Justice failed with the major cases from the financial crisis of 2008 to bring criminal cases. If anything, today’s case represents a de facto acknowledgement of those failures. We look forward to more prosecutions such as this and seek more transparency of the process.” – Lisa Gilbert, director of Public Citizen’s Congress Watch division
“Only time will tell whether ‘too big to jail’ is a myth as federal prosecutors are triumphantly declaring today. Too many important questions remain unanswered, and the public still has no explanation as to why prosecutors have decided against forcing guilty pleas in the past, particularly in egregious cases such as the drug money laundered by HSBC or JPMorgan Chase’s involvement in the Madoff scheme. The public deserves to know whether a financial institution’s sheer size and complexity got it off the hook in the past, and what has changed so that it won’t happen again as prosecutors are promising.” – Amit Narang, regulatory policy advocate, Public Citizen’s Congress Watch division
“The Credit Suisse case does little to repair the damaging message that the Justice Department has sent repeatedly to Wall Street, where until now, no major bank has pleaded guilty to a criminal offense. Even in this enforcement action, prosecutors took care to win assurance from U.S. regulators that they would not revoke licenses or otherwise curtail the firm’s businesses. That courtesy wouldn’t apply to a small firm. There cannot be a separate justice system for the large and another system for the small.” – Bartlett Naylor, financial policy advocate, Public Citizen’s Congress Watch division