Courtesy of Pam Martens.
The ink was barely dry on the $1.9 billion get-out-of-jail-free card that those corporate lawyers that now head up the U.S. Department of Justice handed global bank, HSBC, on Tuesday when long-overdue outrage erupted from the media. There was so much attention to the HSBC stench that a potentially more fascinating and equally smelly deal from the Justice Department went down with little attention the very next day. More on that in a moment.
On the Justice Department’s decision to add part of the drug money laundered by HSBC to its own coffers and call it a day without prosecuting HSBC or any of its employees, CNN quoted Notre Dame law professor, Jimmy Gurulé, an international expert on criminal law. Gurulé said the settlement “makes a mockery of the criminal justice system,” adding that “there appears to be an exception for employees of large banks that have engaged in particularly serious and egregious violations of the law. That’s an insane policy.”
CNBC quoted a statement on the HSBC deal issued by Global Witness, the human rights nonprofit group, which said “Fines alone are not going to change banks’ behavior: the chances of being caught are relatively small and the potential profits from accepting dodgy clients are too big. Fines are seen as a cost of doing business.”
In an editorial, the New York Times called the HSBC settlement “a dark day for the rule of law.” Fingering their worry beads (the beads they threw out the window when their editorial page happily advocated for the repeal of the Glass-Steagall Act – the daddy of too big to fail or jail –) the Times questioned why no individual at HSBC was charged in such a well documented case of money laundering for drug cartels. The editorial said “it boggles the mind that a bank could launder money as HSBC did without anyone in a position of authority making culpable decisions.”
But if the Time wants its mind genuinely boggled, it need only peruse the settlement that snuck in one day later – the insider trading case against the iconic Tiger Asia Management LLC hedge fund that magically became a one-count prosecution of wire fraud – which, having worked 21 years on Wall Street, I can assure you is not the same thing as insider trading. But even more incredulous, the company without the apparent aid of human beings, committed the crime and was the sole defendant charged by the Justice Department — giving corporate personhood a whole new dimension.
You know there’s something really fishy going on when the U.S. Attorney for New Jersey decides to prosecute a hedge fund based in Manhattan – which last time I checked was still a New York jurisdiction. Here are excerpts of the press release from the U.S. Attorney’s office for the district of New Jersey:
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