The Farce Must Go On: Senate Suddenly Furious With Eric Holder For Allowing Banks To Become "Too Big To Jail"

Tyler Durden's picture

Or what happens when Wall Street Muppet A is vewy, vewy angwy with Wall Street Muppet B and desperately needs a ratings boost.

* * *

Straight from the best Senate Wall Street taxpayer bailout money and Fed excess reserves (by way of deficit monetization) can buy:

Sens. Brown, Grassley Press Justice Department On "Too Big To Jail"

Senators Question Whether “Too Big to Fail” Status of Some Wall Street Megabanks Undermines Government’s Ability to Prosecute Large Financial Institutions, Impose Appropriate Penalties

Tuesday, January 29, 2013

WASHINGTON, D.C. – U.S. Sens. Sherrod Brown (D-OH) and Chuck Grassley (R-IA) sent a letter today to U.S. Attorney General Eric Holder questioning whether the “too big to fail” status of certain Wall Street megabanks undermines the ability of the federal government to prosecute wrongdoing and impose appropriate penalties.  They also requested that the Justice Department disclose the identities of parties with whom prosecutors consult about the appropriate level of penalties for financial institutions.

“Wall Street megabanks aren’t just too big to fail, they’re increasingly too big to jail,” Brown said. “Already, the nation’s six largest megabanks enjoy what amounts to taxpayer-funded guarantee by virtue of their size, making it harder for regional and community banks to compete. Now, these megabanks may also enjoy some impunity when they violate the law by laundering money or illegally foreclosing on homeowners.  Wall Street should pay the full price of its wrongdoing, not pass the costs along to taxpayers.”

“The best deterrent to crime is to put people in prison,” Grassley said.  “That includes those at powerful banks and corporations.  Unfortunately, we’ve seen little willingness to charge these individuals criminally.  The public deserves an explanation of how the Justice Department arrives at these decisions.”

Brown, who chairs the Senate Banking Subcommittee on Financial Institutions and Consumer Protection, is the author the Safe, Accountable, Fair & Efficient (SAFE) Banking Act, legislation that would prevent any one financial institution from becoming so large and overleveraged that its collapse could put our economy on the brink of collapse or trigger the need for a federal bailout. He also passed legislation with Sen. David Vitter (R-LA) to requiring the Government Accountability Office to study how banks with assets of $500 billion or more benefit from the belief that the government would not let them fail in a crisis.

As Ranking Member of the Judiciary Committee, Grassley has been critical of the Justice Department’s decisions against holding people criminally accountable in financial cases.  He called the Justice Department’s decision to forego any criminal prosecution of HSBC officials involved in that money laundering scandal inexcusable.  And he has questioned the Justice Department about the number of mortgage fraud cases brought forward, revealing a failure to bring significant criminal cases against any of the major banks or financial institutions that have faced civil actions for various frauds. Grassley is the author of the Fraud Enforcement Recovery Act, signed into law in 2009, that was designed to ramp up the government’s response to the crisis and ensure that prosecutors and investigators had the tools needed to combat fraud.

The full text of the letter from Brown and Grassley to Holder can be found below.

January 29, 2013
The Honorable Eric H. Holder, Jr.   
United States Attorney General
U.S. Department of Justice
950 Pennsylvania Avenue, N.W.
Washington, D.C. 20530


Dear Attorney General Holder:


The large number of private and government lawsuits since the global financial crisis continues to undermine public confidence in our financial markets.  This confidence can only be restored by demonstrating that there are consistent rules in place that provide accountability for wrongdoing and deter financial predators.


Unfortunately, many of the settlements between large financial institutions and the federal government involve penalties that are disproportionately low, both in relation to the profits which resulted from those wrongful actions as well as in relation to the costs imposed upon consumers, investors, and the market.


The nature of these settlements has fostered concerns that “too big to fail” Wall Street banks enjoy a favored status, in statute and in enforcement policy.  This perception undermines the public’s confidence in our institutions and in the principal that the law is applied equally in all cases.


On settling with Swiss Bank UBS for Libor manipulation, for example, you said, “[t]he impact on the stability of the financial markets around the world is something we take into consideration.  We reach out to experts outside of the Justice Department to talk about what are the consequences of actions that we might take, what would be the impact of those actions if we want to make particular prosecutive decisions or determinations with regard to a particular institution.”


In an interview with Frontline, outgoing Assistant Attorney General Lanny Breuer defended the Department of Justice’s inability to prosecute large financial institutions by saying, “but in any given case, I think I and prosecutors around the country, being responsible, should speak to regulators, should speak to experts, because if I bring a case against institution, and as a result of bringing that case, there’s some huge economic effect — if it creates a ripple effect so that suddenly, counterparties and other financial institutions or other companies that had nothing to do with this are affected badly — it’s a factor we need to know and understand.”


These statements raise important questions about the Justice Department’s prosecutorial philosophy.  In order to explore the Justice Department’s treatment of potential criminal activity by large financial institutions, please answer the following questions and provide the following information:


1. Has the Justice Department designated certain institutions whose failure could jeopardize the stability of the financial markets and are thus, “too big to jail”?  If so, please name them.


2. Has the Justice Department ever failed to bring a prosecution against an institution due to concern that their failure could jeopardize financial markets?


3. Are there any entities the Justice Department has entered into settlements with, in which the amount of the settlement reflected a concern that markets could be impacted by such a settlement?  If so, for which entities?


4. Please provide the names of all outside experts consulted by the Justice Department in making prosecutorial decisions regarding financial institutions with over $1 billion in assets.


5. Please provide any compensation contracts for these individuals.


6. How did DOJ ensure that these experts provided unconflicted and unbiased advice to DOJ?


Our markets will only function efficiently if participants believe that all laws will be enforced consistently, and that violators will be punished to the fullest extent of the law.  There should not be one set of rules that apply to Wall Street and another set for the rest of us.


Thank you for your cooperation and attention in this matter.  We would appreciate a response by February 8, 2013.  If you have any questions, please do not hesitate to contact Graham Steele for Senator Brown at (202) 224-2315 or Chris Lucas for Ranking Member Grassley at (202) 224-5225.



Sherrod Brown                                                  Charles E. Grassley

Chairman                                                        Ranking Member

Banking Committee,                                          Judiciary Committee

Subcommittee on Financial Institutions

and Consumer Protection


Don't make the muppets angry. You won't like them when they're angry.

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lasvegaspersona's picture


god knows we tried. We almost had him in 2004. Ensign (no prize himself) lost by fewer than 500 votes. Last round it was the unions who love him because....?

He does little for NV in spite of all his perceived power. His local nickname is Whorehouse Harry. He even pisses off a large swath of the LDS as I have heard....but he still wins. Maybe next time if he hasn't died of stupid-ugly by then.

Timmay's picture

"You are either with us, or you are with the Bankers."

AldoHux_IV's picture

Another poorly devised theatrical display of misdirection as Kerry's confirmation as Sec of State builds more momentum to Iraq's Sequel: "Iran We Hardly Knew Thee" or "Out of Africa and Into Drone Warfare".

If the senate really cared, we would have had justice by now plain and simple.

Troll on central planners, troll on.

bank guy in Brussels's picture

Re John Kerry a.k.a. John Kohn

From the most radical Israeli journalist, Barry Chamish (who has exposed numerous crimes of the Israeli regime, like the Israeli gov't role in killing Israeli Prime Minister Rabin):

«  ... And what did we recently discover; why Kerry is Jewish on his father's side. Kerry was Kohn. Somehow, he forgot the fact that his grandparents were prominent Jewish business people in Prague and that his father is 100% Jewish. Ask yourself, do you know anyone who doesn't know his father's religious background ... »

Bicycle Repairman's picture

Boston media hid Kerry's secret for years.  He wasn't outed until the 2004 presidential run.  By the national media.

Since the Boston media won't ask the question, I will:  Hey, John, what are you hiding and why are you hiding it?

falak pema's picture

I'm waiting for the 30 foot wave, for DJIA to go to 15000 and S&P to shoot to 1600.

Then we will really be ready to surf to a new world record. 

As they say on ZH, its not a question of why or how but of when! 

Hedge Funds Are Selling This Rally - Business Insider

Mom n Pop buying from HFs... Yikes! 

bobthehorse's picture

The rich get away with everything.

They always have.

The Ivy League Mafia rules the world.

Even a black socialist who holds the most powerful office in the world is afraid of rich white guys from Harvard.

So what's a boy to do?

NoDebt's picture

He's not afraid.  I've never seen "that guy" show fear of anything.  He's way too self-assured (arrogant) for that.

So what could it be?  I say he WANTS Wall St. to be even more of a snake pit than it already is.  To have people hate it so much he can come in at some point and confiscate it all to pay for his entitlement programs.  All the while people cheering him on.  "He's finally GETTING those bastards", they'll say.  Meanwhile your 401k and IRA are GONE, if you have them.  Replaced by nice, safe US Treasury bonds.


bank guy in Brussels's picture

Actually the word from Chicago was that when a younger Barack Obama was making the scene in Chicago's gay bars, older white guys were Obama's favourite companions

And still are, some say

But G W Bush had his Gannon / Guckert 'militarystud' guy coming to the White House often on a 'temporary' journalist pass ... the gay prostitute did have a blog, so the press pass was 'legit'

Gannon / Guckert (he used two names) was there one night at the White House with Tony Blair too

For those who haven't seen it, hilarious vid of Bush and Tony Blair talking about going to the 'Gay Bar' together ... from the Electric Six:

Jendrzejczyk's picture

There is one person in the world whose mission in life is to give your every post a single -1.

Always appreciate your perspective, thanks for taking the time to share it.

Tall Tom's picture

IMPEACH the Sodomite in Chief.


President Bill Clinton cheated on his wife by having Monica Lewinski perform Fellatio upon him. That was wrong. But I can understand it.


President Barack Obama cheated on his wife by having Larry Sinclair perform Fellatio upon him. That is wrong. I just cannot understand that.


Then America elects the Homosexual? Mitt Romney's campaign knew this.  So just what did Mitt have to hide?

Clashfan's picture

Wayne Madsen has written at length about how I'llbombya likes to be fellated by older, white guys. Not that I believe everything Madsen writes, but....

Clashfan's picture

Yes, Bob, they do, and they are Luciferians.

mr_bad's picture

Excellent point:  "Too Big To Fail" means "Too Big To Prosecute"  Sounds like they might be starting to get it.

Winston Churchill's picture


This is pure CYA ,and the timing is amazing.These dumbass lawyer Senators think the

statute of limitations has tolled out.It started again  last year with the 'settlement'.

Do we really pay a lot of salary's for these assholes who can't even stay bought.

NoWayJose's picture

Brown and Grassley will wake up tomorrow with a little sweetener in their campaign chests, and this will go no where.  It's not that the banks are too big to fail, the problem is that the banks have too many links to taxpayer dollars and guarantees while they are still able to gamble with unregulated derivatives and leverage.  That's not justice enforcement, it's Congressional laws that allow this to happen.  And yes, they are both too big to fail and too big to jail when they have these taxpayer guarantees in place.

LongSoupLine's picture

At this fucking point I don't care who calls that fucking piece of shit Holder out on the carpet.  String that fucking drug dealer gun giving asshole up to the border fence and let the fucking cartels have their way with the prick.


Fuck you Holder...fucking administration ass suck idiot.

Marge N Call's picture

+100 Yup. Gotta start somewhere.

Bob's picture

I do love that picture . . . and I couldn't care less about fast and furious.

Lost Wages's picture

Then afterward they all went to the Marina to enjoy an $80 glass of champagne and a friendly game of pinochle.

Sudden Debt's picture

who would pay for Obama's third term campaign if bankers would be at par with the law?
doesn't make sense....

Number 156's picture

Freakin Kabuki Theater all the way.

I have a question:

Sherrod Brown, Charles E. Grassley, Have you just woke up to discovering you need to open a big ass can of CYA?

NotApplicable's picture

More like, who told them they needed to implement damage control now?

Since it's the Senate, I see it as "controlled opposition" in order to squelch the uncontrolled noise emanating from junior House members (until they're safely marginalized).

centerline's picture

Yup.  More likely than not is just a tactical move that has been vetted and approved from a risk perspective.

Teamtc321's picture

Addressed to the Honorable.............. I stopped reading the piece of shit right there.

nmewn's picture

Prosecutorial discretion...fuck the law, I'm becoming a bandit.

krispkritter's picture

Too late, the Bankers beat you to it...

rhinoblitzing's picture

You would be what they call a "small fry"

nmewn's picture

Understood, but thats what we all are now though, just small fry, so why not go full bore?

The simple "concept" of the rule of law is no man or woman or entity is above it. In my view, the law has been turned into a weapon against the people, their values and the rule of law itself.

So, if I were to steal from a thief, any thief, would a jury of my peers convict me of it?

Cognitive Dissonance's picture

You'll never be allowed to get in front of a jury of your peers. Instead you will be labeled an economic terrorist and shipped off to Guantanamo......if you're lucky.

The good news is that you will receive 3 hots and a cot for the rest of your life. The bad news is that those orange coveralls will always be three sizes too small.

<Ouch. That's definitely gonna hurt.>  :)

krispkritter's picture

IMHO, the real Guantanamo is not even close to being able to hold the multitudes of citizens that are thinking of the real prospects of retaliating for the excesses of .GOV at this time. Gun control, immigration, DOJ abuses, an ursurper, etc. TPTB will be hard pressed to stem the tide.

akarc's picture

Citizens don't think, they have fantasies. Citizens do not retaliate, they buy Ithings. Citizens are the reason we are in this mess. Been waiting over 40 years for that to change and it has, for the worse.

nmewn's picture

I was kinda counting on getting by with a little help from my brothers in

MayIMommaDogFace2theBananaPatch's picture

...and they just wont turn the fucking music down -- no matter how nicely you ask.

nmewn's picture

And thats another thing (being provocative now) when someone calls the cops about the loud music next door, in their minds eye, do they envision a strapping 6'3 200lb man going to their neighbor to tell them to turn it down or a 5'4 200lb dyke with a bad attitude?

Just one of those weird things I always think about regarding my fellow man ;-)

Clashfan's picture

You ought to think more about your denial of 911 truth.

wisefool's picture

Time to put a new sherrif in DOJ.  How about Elizabeth Warren? She is the super sluether who discovered the true evil: ATM fees should be $2.50 instead of $5.00.

She is a decendant of native americans who was the first woman to breast feed during her Bar exam. If we can follow her wisdom, just get banks to only charge $2.50 per transaction, the nation could put this whole banking crisis behind us. Never again would bad actors do bad things.

/sarc   This stuff is what the typical voter considers when they check their ballot.

francis_sawyer's picture

Super 'Sluether'?...


How about Super Jumper (francis_sawyer is in a musical mood this evening)...

Note: This is a 'SPECIAL SELECTION' offering from francis_sawyer... Anyone who DOESN'T process the juxtaposition of lyrics & verve, well, just doesn't GET IT at all [& probably never will]...

wisefool's picture

I will check it out on february 1st.  IRS says I am now allowed to have limited highspeed bandwidth per month.

sarc: ... As far as "sluether", I was just elevating the word slueth to fit the level of her detective skills. You see, banks do lots of stuff, but the most evil part is charging people ATM fees to get their money. ATMs are security+weather hardened machines that dispense paper money to people. There is management of account information, redundant telephony/power, fail safes, distribution and stocking logistics, lighting, usability, and a need to protect against potential injury to the hundreds of consumers that use them daily. There is some other trivial stuff, but basically its a scam for them to charge you money to get money at any of these locations. Oh and they need to be reliable, cause people panic when they can't get their money. Never-the-less,  its is a trivial matter to accomplish these requirements.

The vast majority of banks do not charge anything if you make withdrawls from an ATM that the bank you chose to keep you money in operates. Some banks only offer you 4 free transactions per month. Which is rediculous, 'cause any normal person goes to the ATM 3-4 times per week.

The real crime in all this, is that if you have an emergency. Lets say you need to buy a pack of condoms, a rose and 2 microwave burritos at a gas station. You don't want use your credit card, or the DEBIT function built into your same ATM card.  There might be an ATM in that store that is not operated by your bank. It might be a different bank or even a company that just runs terminals for this particular market. Both the operator of that ATM and your bank will charge you up to $2.50 each. It should be free. The federal reserve does not charge the banks money. The guys who run this network should also not charge the people any money.

This is the evil. ATM fees. The rest of the Financial Sector are the best people ever. They do the difficult jobs of making markets, creating flows, and contributing to the campaigns of the civil servants of this great democracy.

Elizabeth Warren figured this out. She is a champion for the people, and I hope we can all support her in fixing our economic security forever.


MayIMommaDogFace2theBananaPatch's picture

calc the APR on a withdrawal of a $20 from an off-network ATM.  Now, I dont expose myself to that horseshit but WTF?

You cant justify that, they simply have the sickness.  The sickness called 'never enough.'

Late 90s a city councilman in SF tried to put the kibosh on ATM fees.  DENIED...I don't remember if it came from the state or the fderal level but the basic message was clear 'The banks are gonna do WTF they want to.'

wisefool's picture

I disagree. There was truth in my sarcasm. If there truly were no banks in your area that had free ATMs I do appologize. But I have never had a problem finding a bank offering that service in any area I have lived in. Also, many retailers will accept checks, via a similar computerized network.

40 years ago (yes I am old) people generally had to go to the bank itself to get cash. During business hours. The media attention given to her and the plea/pea under her 15 mattresses of modern convienience was absurd, especially relative to the fact the financial system was in full collapse. Ben was spooling up the copters. Wonder what he was going to charge for cash pallet drop fees?

In summary, My post was more about Glass-Stegal, than Warren, but that has been covered better by others in this thread. Warren is either part of the coverup, or rocking a timmah level I.Q.

MrBoompi's picture

The people who rock this boat find a copy of the Zapruder tape slipped under their door.

monad's picture

from this mortal coil, yes.

pashley1411's picture

"When Muppets attack". Press release, wtf cares, I'm looking for sackcloth and ashes.

Compared to the U S Senate, Nero and his horse look majestic.

francis_sawyer's picture

One step beyond...


When it becomes JEW vs. JEW... all hilarity ensues...