Winners bail out Winners
Of the 1% by the 1% for the 1%
2016 Holder exposed for a combination of political, self-serving and craven reasons held his own department back – the folks who wanted to prosecute HSBC.
A new, thoroughly-documented report from the House Financial Services Committee recounts how career prosecutors in 2012 wanted to criminally charge the global bank HSBC for facilitating money laundering for Mexican drug lords and terrorist groups. But Holder said no. The report — the result of a three-year investigation — shows that aggressive attorneys did want to prosecute HSBC, but Holder overruled them.
Newly public internal Treasury Department records show that AFMLS Chief Jennifer Shasky wanted to seek a guilty plea for violations of the Bank Secrecy Act. “DoJ is mulling over the ramifications that could flow from such an approach and plans to finalize its decision this week,” reads an email from September 4, 2012 to senior Treasury officials. On September 7, Treasury official Dennis Wood describes the AFMLS decision as an “internal recommendation to ask the bank [to] plead guilty.” It was a “bombshell,” Wood wrote, because of “the implications of a criminal plea” and “the sheer amount of the proposed fines and forfeitures.”
ENTER GEORGE OSBORNE – THE FIXER
CORRUPTION AND HOW THEY GET AWAY WITH IT
British financial minister George Osborne complained to the Federal Reserve chairman and the Treasury Secretary that DOJ was unfairly targeting a British bank. DOJ then went dark for nearly two months, refusing to participate in interagency calls about HSBC. Finally, Holder presented HSBC on November 7 with a “take it or leave it” offer of a deferred prosecution agreement, which would involve a cash settlement and future monitoring of HSBC. No guilty plea was required. But even the “take it or leave it” offer was apparently not the last word. HSBC was able to negotiate for nearly a month after Holder presented that offer, getting more favorable terms in the ultimate $1.9 billion deferred prosecution agreement, announced on December 11, 2012.
in 1999, Holder wrote the infamous “collateral consequences” memo, advising prosecutors to take into account economic damage that might result from criminally convicting a major corporation.
In 2013, he unwittingly earned his place in history for telling the Senate Judiciary Committee, “I am concerned that the size of some of these [financial] institutions becomes so large that it does become difficult for us to prosecute them,” which became known as the “Too Big to Jail” theory.
When asked on June 8 why his Justice Department did not equally apply the criminal laws to financial institutions in the wake of the 2008 economic crisis, Holder told the platform drafting panel of the Democratic National Committee that it was laboring under a “misperception.”
Holder is returned to Covington & Burling, a corporate law firm known for serving Wall Street clients in 2015. He had worked at Covington from 2001 until he was sworn in as attorney general in Feburary 2009. Covington literally kept an office empty for him, awaiting his return.
Jennifer Shasky, the AFMLS Chief who requested the prosecution of HSBC but was overruled, recently resigned as the head of the Financial Crimes Enforcement Network to become a senior compliance officer with HSBC.