How to prosecute Wall Street
Banks may be too big to jail, but bankers aren’t.
Andrew Ross SorkinThe New York Times
Banks may be too big to jail, but bankers aren’t, said Andrew Ross Sorkin. The distinction is worth stressing since U.S. Attorney General Eric Holder admitted last week that he hadn’t indicted big banks for their role in the financial crisis because such action could “have a negative impact” on the economy. Holder’s statement is “embarrassingly at odds” with the Obama administration’s promises that banks would no longer be “too big to fail,” but he is not entirely wrong. Remember the fiasco of Arthur Andersen, the accounting firm that went out of business after it was charged with obstruction of justice in the Enron case? No one went to jail, but 28,000 employees—“most of whom had nothing to do with the Enron case or the shredding of documents”—lost their jobs. That’s a painful reminder that charging an entire company, “as opposed to prosecuting the individual employees responsible for the crime,” can cause serious collateral damage. Prosecutors should pursue corporate crime aggressively, but they should focus on holding individuals accountable, not companies. And they should get moving. “If prosecutors had already claimed a prominent scalp from the financial crisis, there wouldn’t be such a loud conversation about too-big-to-jail.”