Newsmax TV & Webwww.newsmax.comFREE - In Google Play
Newsmax TV & Webwww.newsmax.comFREE - On the App Store
Tags: holder | wall | street | financial | crisis

Holder to Wall St.: More Prosecutions Coming Over Financial Crisis

By    |   Tuesday, 20 August 2013 09:17 PM EDT

Attorney General Eric Holder said Tuesday the Justice Department is nearing decisions on several cases involving large financial institutions, and he plans to announce new prosecutions stemming from the 2008 economic meltdown.

"My message is, anybody who's inflicted damage on our financial markets should not be of the belief that they are out of the woods because of the passage of time," Holder told The Wall Street Journal. "If any individual or if any institution is banking on waiting things out, they have to think again."

Editor's Note: Weird Trick Adds $1,000 to Your Social Security Checks

Holder declined to discuss specifics or say when such cases would be announced, but he indicated his own career schedule would not affect those decisions.

The attorney general has said he did not plan to serve out the entire Obama administration term. But he said Tuesday he would not step down before making major charging decisions in cases stemming from the financial collapse.

Associates have said Holder could step down later this year, an indication the new charges may be announced before then.

"I expect to be here to announce a series of significant matters that we'll be bringing," he told the Journal.

While he has been criticized for overstating past efforts, the attorney general said his marching orders to prosecutors around the country have been clear and forceful: "Remain aggressive and pursue these kinds of cases."

Holder and the White House have faced increasing criticism for not bringing criminal charges against any senior executives over the 2008 market meltdown, the Journal reports.

The attorney general would not say whether any new cases would be civil or criminal but indicated that Justice would pursue whichever type of case was most likely to work in court.

In recent days, disclosures have shown that the federal government was pursuing new prosecutions of possible abuses in the mortgage-backed securities industry, the Journal reports.

The explosive growth of that industry helped fuel the housing bubble, which led to a credit crisis when the bubble popped and financial institutions were left holding securities that had plunged in value.

Earlier this year, Justice sued Standard & Poor's Ratings Services and its parent, McGraw-Hill Financial, over mortgage-bond ratings, saying the firm misled investors. The company has denied the charges.

Any new cases would not be limited to pre-meltdown activity, the Journal reports.

Earlier this month, Justice said it was suing Bank of America for hiding risks about mortgage-backed securities from investors in 2008.

Federal prosecutors also filed criminal charges against two former traders of JP Morgan Chase, accusing them of misstating losses in bad bets that eventually cost the bank more than $6 billion last year.

In the interview, Holder added that several cases are now coming to a head, in part because they were complicated, and in part because he had been urging prosecutors to complete their investigations.

"These are complex cases that require enormous amounts of effort to put together, but we are at a point — as you've seen, I think, recently — where the result of that difficult work is starting to bear fruit," he told the Journal.

In the past year, according to Justice Department officials, prosecutors have made progress in their inquiries of residential mortgage-backed securities, in part because of increased pressure from top Justice officials.

Asked about JP Morgan and its chief executive, James Dimon, Holder declined to discuss specific cases.

However, he said, "No individual, no company, is above the law. We don't investigate companies based on who a CEO is, but we don't avoid investigating companies based on who the CEO is, either."

According to public filings and officials familiar with individual investigations, JP Morgan Chase faces at least seven government investigations of its conduct, on issues ranging from mortgage-backed securities during the housing boom to a criminal probe of alleged manipulation of the energy market in California and the Midwest.

JP Morgan declined to comment to the Journal on either matter.

John Coffee, a law professor at Columbia University who studies white-collar crime and securities fraud, told the Journal that the Obama administration "has been appropriately criticized for being excessively equivocal and slow to respond'' to the financial crisis.

But he said Holder's interview comments suggested "he is responding to the temper of the times.''

Still, Coffee said, he expected the five-year statute of limitations on many white-collar crimes may bar a successful prosecution of a number of precrash abuses, the Journal reports.

© 2024 Newsmax. All rights reserved.

Attorney General Eric Holder said Tuesday the Justice Department is nearing decisions on several cases involving large financial institutions, and he plans to announce new prosecutions stemming from the 2008 economic meltdown.
Tuesday, 20 August 2013 09:17 PM
Newsmax Media, Inc.

Sign up for Newsmax’s Daily Newsletter

Receive breaking news and original analysis - sent right to your inbox.

(Optional for Local News)
Privacy: We never share your email address.
Join the Newsmax Community
Read and Post Comments
Please review Community Guidelines before posting a comment.
Get Newsmax Text Alerts

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved
© Newsmax Media, Inc.
All Rights Reserved