Better late than never? If tonight's report from the New York Times is true, we can anticipate indictments and/or guilty pleas on criminal charges for Credit Suisse and BNP Paribas in the near future.
The criminal charges against France's BNP Paribas are expected to be related to illegal banking for Sudanese actors, in violation of prohibitions responding to human rights abuses.
The charges against Credit Suisse (of Switzerland) will be related to providing tax shelters for Americans; basically, for aiding and abetting tax evasion en masse.
This is obviously good news. Although we've yet to see the charges brought, and yet to see charges brought for the myriad crimes other banks have committed in the past few years, the precedent is important. Moral hazard is a weapon banks love to deploy against ordinary people, but now the shoe may be moving to the other foot.
Below squiggle for link and quotes:
Federal prosecutors are nearing criminal charges against some of the world’s biggest banks, according to lawyers briefed on the matter, a development that could produce the first guilty plea from a major bank in more than two decades.
In doing so, prosecutors are confronting the popular belief that Wall Street institutions have grown so important to the economy that they cannot be charged. A lack of criminal prosecutions of banks and their leaders fueled a public outcry over the perception that Wall Street giants are “too big to jail.”
The discussions with regulators, recounted in interviews with the lawyers and in records obtained through a Freedom of Information Act request, offer a lens into the political and legal minefields that prosecutors navigate when investigating big banks. The interviews also demonstrate that defense lawyers continue to push prosecutors not to act without assurances that regulators will keep a bank in business.
In a recent speech to Wall Street lawyers, Mr. Bharara said this dynamic created a “gaping liability loophole that blameworthy companies are only too willing to exploit.”
Mr. Holder’s criminal division — which a week after announcing the HSBC case hosted a meeting with regulators to discuss “corporate resolutions,” according to records — has held discussions with the New York Fed about securing a guilty plea in the Credit Suisse tax shelter case. While the criminal division might ultimately extract a guilty plea from Credit Suisse’s main banking affiliate in Zurich, the lawyers briefed on the matter said, they have not ruled out charges against the bank’s parent company. The case is expected to be announced before the action against BNP.