Sen. Warren Continues Campaign Against 'Too Big To Jail' Banks
Letter to heads of SEC, Federal Reserve, and Justice Dept. demands to know if and when "public interest" trumps protecting big banks
Following up on a series of questions first posed during a Senate Banking Committee Hearing earlier this year that left her concerned that the nation's largest banks weren't only "too big to fail" but "too big to jail," Senator Elizabeth Warren (D-MA) on Tuesday sent a strongly worded letter to the heads of the SEC, the Justice Dept, and Federal Reserve demanding a better explanation about how these large financial institutions continue to avoid criminal trials or more aggressive prosecution by government regulators.
"I believe strongly that if a regulator reveals itself to be unwilling to take large financial institutions all the way to trial -- either because it is too timid or because it lacks resources -- the regulator has a lot less leverage in settlement negotiations and will be forced to settle on terms that are much more favorable to the wrongdoer," Warren said in the letter that went to Fed Chairman Ben Bernanke, Attorney General Eric Holder, and SEC Chairman Mary Jo White.
"If large financial institutions can break the law and accumulate millions in profit and, if they get caught, settle by paying out of those profits, they do not have much incentive to follow the law."
The letter continued: "If large financial institutions can break the law and accumulate millions in profit and, if they get caught, settle by paying out of those profits, they do not have much incentive to follow the law."
Couching her inquiry as a matter of public interest, Warren asked the powerful trio to describe for her what kind of "internal research or analysis" their agencies perform in order to decide "the cost to the public" when bank malpractice is enabled by toothless approaches by the institutions designed to check their behavior.
Warren has continued to be a thorn in the side of the big banks and those in government that have long insulated them from public scrutiny and accountability. As a laudatory article by TruthDig columnist Robert Scheer this week acknowledges:
How astonishing to have a public servant who actually cares to inform the public about the inner workings of the system of crony capitalism that has wedded big government with big business. This comes at the expense of the free market that corporate lobbyists delight in invoking as an ideal while they subvert it as a reality.