Senior U.S. lawmakers from both parties are seeking more criminal prosecutions for executives tied to financial-industry wrongdoing as the government reaches billion-dollar settlements with UBS AG and HSBC Holdings Plc.

Representative Barney Frank, a Massachusetts Democrat and co-writer of the 2010 regulation overhaul that bears his name, said in a letter to U.S. Attorney General Eric Holder this week that the Justice Department must increase prosecution of individuals to ensure the “integrity of our financial system.”

“If you don’t have some CEO sitting in prison it doesn’t send any signals,” Senator Charles Grassley of Iowa told Lee Pacchia in an interview for a “Behind the Headlines” episode on Bloomberg Law Multimedia. “It sends the signal that it’s business as usual and with serious crimes like this you can’t have business as usual. You’ve got to have prosecution and there hasn’t been prosecution.”

Grassley, the top Republican on the Senate Judiciary Committee, said the $1.92 billion HSBC agreed to pay last week to settle U.S. money-laundering probes was merely a “spit in the ocean” for Europe’s biggest bank. His comments came after UBS agreed yesterday to pay $1.5 billion over claims that the bank tried to rig global interest rates in a case that involved criminal charges against two traders.

The UBS settlement is the second in the investigation of attempts to manipulate interest-rate benchmarks including the London interbank offered rate after Barclays Plc agreed to pay 290 million pounds in June. Regulators have sought information from more than a dozen banks that set rates in the U.S., Europe and Japan that underpin more than $300 trillion in contracts.

Justice Consultations

The letter to Holder from Frank, who is retiring from Congress two years after passage of the Dodd-Frank Act, called on the Justice Department and bank regulators to begin a series of consultations with the goal of increasing prosecutions. The letter, dated Dec. 18, didn’t mention UBS or HSBC.

“It is, of course, the case that no corporation can have engaged in wrongdoing without the active decision of individual officers of that entity,” he wrote. “I believe it is also the case that prosecuting individuals has more of a deterrent effect than prosecuting corporations.”

Civil penalties for banks are minor compared to the institutions’ earnings or even what they made as a result of the wrongdoing, Grassley said in the Bloomberg Law interview.

“So why no criminal prosecutions ever?” he said.