Lanny Breuer’s Theory of Chatting Accountability for CEOs
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This whole video is worth watching. Eliot Spitzer, former US Attorney Mary Jo White, and Assistant Attorney General Lanny Breuer discuss financial crimes, with SIGTARP head Neil Barofsky moderating. I was fairly troubled, in general, of the hesitations White and Breuer expressed over actually prosecuting financial crime.
But I found the passage just after 46:00, where Lanny Breuer argues you don’t need prosecutions for deterrence among CEOs, to be stunning.
Look, I want to be clear, I don’t want to suggest for a moment that we don’t–and we will–aggressively pursue cases criminally but, I guess both as a defense lawyer, which I was for many years, a white collar defense lawyer and now as AAG, I don’t think we should completely discount the deterrent effect when we investigate cases even if we don’t bring them.
If a CEO or CFO of a major institution feels that he or she is subject to criminal liability, when we interview them or put them in the grand jury, they have lawyers and this is hanging over their head for years and years. It may be at the end we decide not to prosecute the company or the individual but I think it’s really inaccurate to suggest that that doesn’t have a very strong effect. I’m not sure CEOs on Wall Street right now feel as if they can do what they want and there’s no deterrence.
He returns to a discussion of “going in and out” between corporate representation and DOJ after 52:00 and he avoids talking about robo-signing at 1:00.
As you read that, think about what has happened with Lloyd Blankfein. He bullshitted Carl Levin’s investigatory committee back in April 2010. Levin released a report last year stating he had lied, and referred his investigation to DOJ.
And Lloyd Blankfein, who almost two years ago didn’t take Congress sufficiently seriously to tell the truth, is still running around free profiting off of European countries’ debts.
Does Breuer really think seeing Blankfein treat Congress and regulators with utter disdain served as a deterrent to anyone? On the contrary, what appears to have been Lanny’s Chatting Accountability for CEOs only serves to show that these MOTUs are above the law.
Amen, Marcy. Seems Mr. Breuer is on their team- as are Mr. Obama and Mr. Holder. Doesn’t leave the 99% much, does it?
@justbetty: Well, and it also felt like Breuer was having difficulties thinking of jailing “the kind of people” he used to represent.
Remember he represented Freddie Mac and Wells Fargo while at C&B.
Same reason why Corzine felt no reason to invoke the Fifth when he came down to tell Congres a month or two ago that a couple billion of other peoples’ money, more or less, had turned into vapor on his watch and he had no idea where it went.
Compare to Bernie Madoff, who ran to turn himself in and get a nice cushy bunk at Club Fed. He didn’t do so out of fear of the government or a sense of justice. He’d ripped off Russian oligarchs (among others) and knew they’d be coming to collect. With garden and woods tools.
Wall Street in particular and the financial sector more generally work on fear and greed. But, greed is merely another flavor of fear – the fear of being broke and all that entails (no more dinners at 21, scotch, hookers, coke, people sucking the shit out of your ass, being mocked, etc.) – it’s flipside, really. The only way to govern bankers is through fear.
And they have no fear of the government. They own it, after all.
Right on Scribe.Makes you want to meditate on instant karma.
Stock bubbles, internet bubbles, real estate bubbles, even conceit bubbles. It’s like these types – MOTU and their servants – barely glance at their own press i.e. WSJ & NYT to see the contempt the 99% holds for CEO’s that run companies into the ground and walk away with huge retirement packages, or take Bail-out Bonus money without shame mocking the Tea Party and Occupy as “morans”. Chomsky put it thusly: The rabble must be instructed in the values of subordination and a narrow quest for personal gain within the parameters set by the institutions of the masters; meaningful democracy, with popular association and action, is a threat to be overcome. (p.23 Year 501 Noam Chomsky).
The Masters political sycophants responsibility as explained by Nancy Pelosi (though it’s of a different matter the attitude is prevalent): “We have to make responsible decisions in the Congress that are not driven by the dissatisfaction of anybody who [wants the war to end tomorrow,]” Pelosi told the gathering at the Sofitel, arranged by the Christian Science Monitor. Though crediting activists for their “passion,” Pelosi called it “a waste of time” for them to target Democrats. “They are advocates,” she said. “We are leaders.”
Well, it’s true that investigation without prosecution has SOME deterrent value. But only if SOME people are, in fact, prosecuted. If no one is prosecuted, that pulls the fangs out of the bite of investigation. Another fang is pulled if only obscure, little publicized CEOs get prosecuted, while high-flying CEOs flaunt their criminality openly.
Bob in AZ
You could call it world-wide tough love for insincere reform, 9 pm EST daily.
21st century tools + the world’s mind + love = healthy power shift
@Bob Schacht:
Cannot help but think of ENRON…
@Bob Schacht:
When you add in the Goldman mentality, however, the deterrent effect is lost.
The Goldman mentality is simple: “WE are untouchable, and any of you lesser MOTUs who get caught had it coming. The fact that you even got investigated is proof of OUR superiority and your inferiority. It’s survival of the fittest, bay-bee, and you got et.”
No deterrence at all.
Until one of these people is perp-walked on nightly news this is not a country under the rule of one set of laws.
EW,
Are your timelines still available for viewing?
@klynn: Not as apposite, but I couldn’t help but think of the left-to-right unison in the Villagers’ cries for mercy on Scooter Libby’s soul.
Couldn’t agree more Peterr. Were they even named as one of the five to be “punished?”
If the argument were true – “investigating” cases is as strong a deterrent as prosecutions, convictions, jail time and prohibitions from managing an SEC issuing company – we wouldn’t be in this mess.
Insidiously, Breuer – who is actually being paid to act as one of America’s top prosecutors – is still making the classic white collar criminal defense lawyer’s basic argument:
That’s the kind of argument that’s persuasive when a child or teen is caught with his hand in the cookie jar or on the steering wheel of his neighbor’s Cadillac. It ought not be mentioned with a straight face in an age when CEO’s have dispensed with shame outside of the context of Orwellian official apologies, and are brought up in the belief that no conduct is too egregious to engage in if the government doesn’t catch you at it, make you stop it, and make you pay penalties that so exceed the expected gain from it that even an American board of directors would wake up and take notice.
One needn’t be a fan of the Lincoln Lawyer to appreciate the unseemliness of having the Assistant Attorney General make that argument in public. It’s a farce.
@klynn: Precisely. That Breuer makes it is more evidence of the DoJ’s official corruption. It’s not the sort of law and order, put the bastards in jail and throw away the key, one expects from both sides of the aisle in an election year, especially given that this is the first president to discard formal constitutional protections and legislate into law his legal ability to do just that.
If the argument were true – “investigating” cases is as strong a deterrent as prosecutions, convictions, jail time and prohibitions from managing an SEC issuing company – we wouldn’t be in this miss.
Insidiously, Breuer – who is actually being paid now to act as one of America’s top prosecutors – is still making the classic white collar criminal defense lawyer’s basic point:
“The process has scared my client into going straight and you guys don’t really need to finish your investigation, publicly document his wrongdoing, and take him to trial, do you? Now check whether I’ve spelled your name correctly on my Christmas gift list.”
That’s the kind of argument that’s persuasive when a child or teen is caught with his hand in the cookie jar or on the steering wheel of his neighbor’s Cadillac. It ought not be mentioned with a straight face in an age when CEO’s have dispensed with shame outside of the context of Orwellian official apologies, and are brought up in the belief that no conduct is too egregious to engage in if the government doesn’t catch you at it, make you stop it, and make you pay penalties that so exceed the expected gain from it that even an American board of directors would wake up and take notice.
One needn’t be a fan of the Lincoln Lawyer to appreciate the unseemliness of having the Assistant Attorney General make that argument in public. It’s a farce.
It’s nice to complain, it’s nice to indulge in letting off steam”, but really, beyond that, see that the Republic, (“If you could keep it… !” ), may have morphed to… gigantic… affluent plantation, and the affluence may be a shakier grounds going forward.
As the very things, in the commons get rendered to privatize, so as to make assets availeble for/to appease balances in the trade/offshore of the production equation, new owners, with little encumbrances of a long history of “civil rights”, and social egalitarianism, look for the plantation, and docility promoted by a veneer of Liberalism… to head in a direction, way south of the American Dream… dream.
Which was all to work this thought, something from I thing Hannah Arendt maybe, but there was a phenomena referer to (in an analysis of the psychological atrophy of the prisoners in the Holocost camps: “Concentration camp syndrome… ”
to sum up, it included… a dire gallows humor among other things, to wit: this hopelessness conditioned a passivity, a spiraling into further torper and ease of handling, employing even the dispicable “capo”, so that, when there is yet some dissent allowed… the ultimate end, don’t look like it will be a forever thing! Ta da!
You also see a telegraphing of the aims and intentions of the leaders in there very body language, e.g., the AG who looks like a meek lap dog, a nervous terrier/chiwawa with a spanials disposition, sorry spaniels.
perp walk – hell.
America is yearning for a hanging judge.
Absent that – expect random explosions, kidnapped spawn and trophy wives.
Some things are best left to the Latins… they understand pay back.
@G Marks: We might indeed be heading towards a hanging judge. Unfortunately, however, the people s/he might hang are not necessarily those whom you would choose. More likely, it would be the rebels or misfits.
Think back to the days of the Wild West to which you refer with such longing. Who was it that got hung by those judges?
Bob in AZ