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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Vendetta's picture

this letter will certainly make the crickets get louder at the DOJ.

earleflorida's picture

"The Depressions 'Pecora Commision'... hung em, all high and dry!!!

*The bankster, bete`noire el'grande nemesis!

*Definition: Fearless! 

BullyBearish's picture

Three words boys..."STATuTE of LIMItATIONS"


The clock is ticking...

Dewey Cheatum Howe's picture

And I suspect so is the safety on some people's weapons if these guys are not held acountable.

yogibear's picture

Eric Holder would fit right in with Chicago Politics (Obama's political grooming crowd). Occasionally or never show up in his office.

Just a token placeholder, do-nothing, useless Attorney General.

Absent political place Holder collecting a paycheck for doing nothing.  

TraderTimm's picture

Want to starve the banks? I think you know how. Just need to get that sovereign currency needle out of your arm. Cmon, it won't hurt after the 48 hours of withdrawal.

Tall Tom's picture

Why starve them when you can overdose them?


A coordinated Deposit/Withdrawal of funds attack from many depositors will send Fractional Reserve Requirements through the roof. The Banks will have signals that they are sitting upon a large amounts of deposits which, of course, they do not have. The distortions of a coordinated attack will send shudders throughout the entire Banking Sector. Of course that would be an act of Economic Terrorism. What makes you think that Foreign Central Banks, like the Bank of China, are not thinking about doing this?

ekm's picture

I'll tell you how this works. It happens all the time in post communist eastern europe or in China it happens openly everyday.


A group of politicians get together with some "businessmen" and come up with a business. After they steal as much as they can, the 2nd step is to erase all traces of the crime.

However, there are victims screaming for blood. 


No problem. Stick it to one or two or three low end collaborators. Then call the senators to start investigating.


This is where we are right now. The big thieves think they've erases all traces and the few little fish will go to jail.

It never changes, never, ever, ever.


However, there are cases when one hits a very stubborn prosecutor and all hell breaks loose. It happens rarely, but it happens.

Atomizer's picture

Many DNA members have woken up. ObamaCare will use DNA forensics to determine your medical classification. Free medical participation will depend on your DNA sequencing. Those with lower government modeling threat will receive hospital services first. Others will prevail by having to pay a high risk premium to seek medical care. Save this post. It will become truth. 

My job is to help you see the future plans. Take it or leave it, just giving you heads up! 

The Obama unemployment union reclassification job creation plan comes in parallel. He plans to collapse the free market and drive everyone to go back to seek unionized education under the falsehood of central planning goals. The government will decide your carbon tax pay grade and monetary advancement.

lizzy36's picture

Ask Geithner.

He was admant NO prosecutions. Wouldn't be good for confidence.

Then again if one goes after the biggest banks and the executives one has to go after the TBTF regulators, including but not limited to TIM GEITHNER.

SO perhaps many in power were not interested in "prosecution" because they themselves would have been subject to it.

Atomizer's picture

Nice to hear from you Lizzy36


Have a peek, the fake monetary paper creators have the shits.

Propaganda (1928)

ekm's picture


The order not to prosecute can come only from the president.


The problem with that is that the victims keep calling for blood. Obama thought that with Eric Schneiderman the victims would be content, but not happening since the housing sector is not getting any better.


He's got to blame somebody, so next step would be to find a famous prosecutor that has no clue about finance like Mary Jo White who will go after small fish.

John Gotti is one thing, big finance is a totally different thing. It's way out of her league.

MrBoompi's picture

Obama calls the shots? Now that's some funny shit!

ekm's picture

Let me repeat this for the Nth time.
Legally, the president calls the shots.
There are muppeteers behind him, but they have no legal power to issue orders like that.

Tall Tom's picture

I am sorry but it is Goldman Sachs, through Geithner, who tells the President what to do.

killallthefiat's picture

These are not the insolvent governments that you are looking for.

hooligan2009's picture

they didn't make that

yes we can!

they are not spartacus

mt paul's picture



Jan 27 (Reuters) - Bank of America has begun moving $50 billion of derivatives out of its Irish-based operations into its British subsidiary, The Financial Times reported on its website on Sunday

hooligan2009's picture

apparently Ireland doesn't want a TBTF bank to drag down its economy....again...maybe they don't think BofA is going to be around for much longer.

and don't forget that the true cost of the bail-out of TBTF is not restricted to taxpayer money handed over, because BofA won't be paying taxes any time soon

According to its most recent disclosures, the bank is sitting on more than $8bn of so-called deferred tax assets in the UK, against which it can offset profits to reduce or eliminate its corporate tax bill.

syntaxterror's picture

How do you "move a derivative"?

Tall Tom's picture

Close an account an reopen it elsewhere.

hooligan2009's picture

ponders....maybe just maybe...there are enough good men and women of conscience at the SEC, FTC, DoJ, ATF, FBI, CIA, DA's, auditors, lawyers etc who are just a whisker away from wanting to each blow their own very, very large whistles and "out" the failings of the system in bringing those engaged in criminal acts to justice.

there are now tens of millions of people affected from mortgagees, to those paying insurance, to those forced out of work by offshore outsourcing and failure to repatriate taxable profits held overseas by each of the major corporations, to those not getting needed drugs and surgery because of tax transfers to banks, to savers punished with low rates in an experiment with no measure of success or duration. not to mention families without sons and daughters, brothers and sisters because of wars fought in back of beyondville.

ZH can act as a prompter/suggestion box, but what we need is a Wikileaks box that people can trust will a) not get back to them (no reprisals), b) will take them seriously, and c) is easily accessible.


final thought, women should not be front line combat troops, because men would, generally, not get raped when captured and there are always, always SNAFU's involving large scale military operations. men should not have to shield women so that women can fight.

10PastMidnight's picture

That's exactly what I wanted to hear from the Senators many months and months ago, did they look back in the playbook to pull this one out of their asses? It's as if they have people perusing the countryside and the online forums looking for the answers to "what the people want to hear" this week.


Oh and Fuck Y............ ah hell it doesn't even make me smile anylonger.

MrBoompi's picture

Dear Senators Brown and Grassley,

Fuck off.

Yours truly,
Eric Holder, Jamie Dimon, Lloyd Blankfein, Ben Bernanke, John Stumpf, Brian Moynihan, and Michael Corbat

JR's picture

Ain’t nobody too big too jail. It’s just that the jailers are too little to jail ‘em. Well, then, if Congress ain’t big enough, the market is!

Straight talk from Ron Paul:

 “Without an intellectual awakening, the turning point will be driven by economic law. A dollar crisis will bring the current out-of-control system to its knees.

"If it’s not accepted that big government, fiat money, ignoring liberty, central economic planning, welfarism, and warfarism caused our crisis we can expect a continuous and dangerous march toward corporatism and even fascism with even more loss of our liberties. Prosperity for a large middle class though will become an abstract dream.

“This continuous move is no different from what we have seen in how our financial crisis of 2008 was handled. Congress first directed, with bipartisan support, bailouts for the wealthy. Then it was the Federal Reserve with its endless quantitative easing. If at first it doesn’t succeed try again; QE1, QE2, and QE3 and with no results we try QE indefinitely—that is until it fails.

“There’s a cost to all of this and let me assure you delaying the payment is no longer an option. The rules of the market will extract its pound of flesh…and it won’t be pretty.”

End the Fed before the Fed and its too-big-to-jail owners end U.S.prosperity and sovereignty.

digalert's picture

And now you angry spineless senators, what are you going to do when Holder says f***you and throws your little proposal in the round file? Just wondering.

Sigep0612's picture

Com'on the US has more problems than a can of worms on the opening day of fishing season.    It's simply too late.  US deficit projected to be $17.5T by the end of this year and we're shouting down the bankers?   So if we round up Dimon, Geither, Paulson, Bernake and threw them in jail....then what.  Would we stand back with our hands on our hips and say.."See we showed them."   The resolution to the problems that plague the US is not something the US population (and the world) is willing to accept...a lower standard of living, fewer entitlements and higher taxes.   

It's only a matter of time folks.  How long do you think people will tolerate this false prosperity.  This uncertainy? 

 Eventually, the global slate will be wiped clean and then and only then will we be able to retrieve common sense and confidence.       

Diablo's picture

you can have them pay a few billion in civial penalties


you can persue criminal charges which instanly causes a bank to cease to exist....and leads to the collapse of the banking system. (imagine what would happen if citibank was charged criminally?)

catch 22, bitchez.


MrBoompi's picture

So nationalize the goddamn criminal enterprises and jail all of the crooked bastards. If we don't have the balls to do that we can't expect anything but a total collapse anyway.

What would happen if Citibank was charged criminally? I guess we are too hopelessly terrorized to find out.

vincent's picture



an organism that lives on or in an organism of another species, known as the host, from the body of which it obtains nutriment. 2.
a person who receives support, advantage, or the like, from another or others without giving any useful or proper return, as one who lives on the hospitality of others. If it walks like a duck, quacks like a duck..
sodbuster's picture

Holder is NOT the top law enforcement or prosecutor in the nation. He is more like a mob lawyer. He is there to ENSURE that no one is prosecuted and to diffuse any and all legal actions against the Insiders. He runs interference for them. These people have no moral compass whatsoever. Criticism runs off them like water off a duck. They don't even try and hide any longer. The USSA has become just another "pimple on the buttocks of the world", two- bit third world country, run by a Marxist wanna- be dictator.

MrBoompi's picture

Exactly the whole fucking executive branch and most of congress are paid to protect these thieves Don't look for justice anytime soon.

logicalman's picture

Laws are a (very bad) joke if encorced selectively.

If it's illegal for me it's illegal for you. Simple.

Let's look at printing money.


overmedicatedundersexed's picture

they wrote a letter , now that's huge, maybe name calling comes next..they all voted for the bail outs the tarps and kept quiet when bernake told them to mind their own business time and time again..what brought this letter out, perhaps many of us taxunits have done what i did and quit the dem/ gop and registered libitarian or indie. after the debt limit boner give away. my only hope is the gop dies quickly for the lies they have fed so called conservates year in and year out.

Zigs's picture

Day late and a dollar short.  Make that $16 trillion, short.

Atomizer's picture

The Obama administration has created and appointed upwards of 40 czars - 2009


2012 List Obama Czars 

Faces, the fear in pushing the agenda while dodging geolocation identification. NGO’s continuing to sponsor or cancel rapid propaganda missions. How does one form the mind in bending the spoon.. /sarc


[We are not going to give you more technology to exploit, your derivatives market will bend your financial spoon in a negative effect]. Welcome to your own concocted New World Order Twist of fucked up losses. Blows a kiss to my 2.0 cunts.. Thank you!


Tag, your it.. This isn’t a fucking joke.. Watching the demise will become entertainment.  


cherry picker's picture

Isn't it Patrick Henry who said, "Give me liberty or give me death?"

He was considered a hero, right?

Liberty is only possible if there is justice.

We see both eroding today and Patrick Henry is probably considered an "extremist" by the politically correct.


syntaxterror's picture

I thought the Fed Chairman was tasked with regulating the banks. No?

lakecity55's picture

So, according to the picture with this article, our reps are actually muppets.

Now I know what's wrong.

Lord Of Finance's picture

Lets get on with the 'show trial'!


    and coming in his first "real" term as comrade in chief, all Austrian economics schooled and influenced individuals will be rounded up and loaded onto Amtrac trains en route to Chicago to be "re-educated".



                                             ALL ABOARD!!!!!!!!!!!!

The Heart's picture

"Lets get on with the 'show trial'!"

Okie dokie, here come da judges with some REAL just-us entertainment first.:


poldark's picture

The banks and the large corporations ARE the government. They are responsible for redistributing wealth around the world.

World government policy will be discussed at the Bilderberg meeting in Germany later this year. Most of the people who were at Davos will be there. The Davos meeting is a very expensive social event. The Bilderberg meeting will be the business meeting.


Whatever its early mission, the Group is now “a shadow world government….threaten(ing) to take away our right to direct our own destinies (by creating) a disturbing reality” very much harming the public’s welfare. In short, Bilderbergers want to supplant individual nation-state sovereignty with an all-powerful global government, corporate controlled, and check-mated by militarized enforcement.

“Imagine a private club where presidents, prime ministers, international bankers and generals rub shoulders, where gracious royal chaperones ensure everyone gets along, and where the people running the wars, markets, and Europe (and America) say what they never dare say in public.”

Early in its history, Bilderbergers decided “to create an ‘Aristocracy of purpose’ between Europe and the United States (to reach consensus to rule the world on matters of) policy, economics, and (overall) strategy.” NATO was essential for their plans – to ensure “perpetual war (and) nuclear blackmail” to be used as necessary. Then proceed to loot the planet, achieve fabulous wealth and power, and crush all challengers to keep it.

Along with military dominance, controlling the world’s money is crucial for with it comes absolute control as the powerful 19th century Rothschild family understood. As the patriarch Amschel Rothschild once said: “Give me control of a nation’s money and I care not who makes its laws.”

Bilderbergers comprise the world’s most exclusive club. No one buys their way in. Only the Group’s Steering Committee decides whom to invite, and in all cases participants are adherents to One World Order governance run by top power elites.


amanfromMars's picture

Bilderbergers comprise the world’s most exclusive club. No one buys their way in. Only the Group’s Steering Committee decides whom to invite, and in all cases participants are adherents to One World Order governance run by top power elites. .... Wed, 01/30/2013 - 02:50 | 3197998 new poldark

Seems to me like Bilderbergers are in dire straits need of novel searching virtual machine algorithms/metadatabased source intelligence for advanced trading platforms and plan phorms, poldark. And any and all omissions and epic failures to provide what is future needed and presently available, is proof positive of new blood required in the Group’s Steering Committee ........ or future intelligence wasting IT resources if considering them suitable future global players without their being able to provide what is needed for what is needed to that and to those who can contract and promise to deliver it ..... with ITs Creative Command and Cyber Control of Computers and Communications/C42 Systems of Quantum Communication Control .... AI@ITsWork.?!

I Kid U Not.

Zwelgje's picture

Their algo's sure misread 'Syria'. The subjects there don't seem to respond on the 'incentives' as expected.

Sandmann's picture

Fascism was the attempt to marry the politics of the masses with the hereditary rights of the classes as monarchy was destroyed in WW1. The Platonic Republic was the post-WW2 method of building EU and other Institutions immune from democracy so the Oligarchs could rule in the "name of The People" and now we simply have Oligarchy.

amanfromMars's picture

Good Morning, Zero Hedge

Wanna trip down the rabbit hole?  Wanna see what is in store and in storage and steerage?

Posted by amanfromMars on 01/29/13 10:47 PM …. sharing an inconvenient truth on
Here and below is something to realise is not untrue and would warrant a headline ...."US Inaction on Wall Street and Fed Feeds Leads Another Undeclared War in and on Washington"
<quote> "Boy, did it perk up some ears at 195 Broadway," says Hopper. It wasn't even that 350,000 fraudulent calls was that big a number. Rather, it was the fact that there was really nothing that could be . done about it, at least not at once. "It was immediately recognized that if such fraud could be committed with impunity, losses of staggering proportions would ensue," Caming said. ''At that time we recognized -- and we can say this more confidently in public in retrospect -- that we had no immediate defense. This was a breakthrough almost equivalent to the advent of gunpowder, where the hordes of Genghis Khan faced problems of a new sort, or the advent of the cannon."
The initial plan with Greenstar was simple: Wait. Watch. Listen. Gather statistics. Tell no one. Most important, don't do anything that would give it away. "There was no prosecution during those first couple of years," Hopper says. "It was so the bad guys would not be aware of the fact that they're being measured." It was only later, Hopper says. that AT&T decided to switch from measurement to prosecution. Even then! Hopper said, "The presence of Greenstar would not be divulged and that evidence gathered to support toll fraud prosecutions would be gathered by other means." Instead, Hopper relates, Greenstar would be used to alert Bell security agents to possible fraud. The security agents would then use other means, such as taps and recordings, to get the evidence needed to convict. "Greenstar bird-dogging it would not be brought out," says Hopper. "It was just simply a toll fraud investigation brought about by unusual signaling and you would not talk about the fact that there was a Greenstar device. That was the ground rule as I understood it. Any court testimony that I ever gave, I never talked about any of that." As another telephone company official put it, "If it ever were necessary to reveal the existence of this equipment in order to prosecute a toll fraud case, [AT&T] would simply decline to prosecute.""  ….. </quote>
That extract from "EXPLODING THE PHONE The Untold Story of the Teenagers and Outlaws Who Hacked Ma Bell" …  PHIL LAPSLEY [Grove Press New York] has a carbon copy clone of itself in the too-big-to-fail model of fraud and insider trading/simply complex common electronic theft which has banking and politicians running for cover and seeking the protection of bought courts of selective justice and distracting media tales of new destructive ventures and warring land grabs in foreign lands/emerging states of intelligence.
And have you any idea of the size of the mountain of undeniable evidence secret intelligence services have collected and processed to be able to prove beyond a shadow of any doubt, the guilt of leaders? Methinks not, but it is surprising and would stagger you, but for the virtual machinery involved is it as nothing and it just keeps on giving.

Now what do you imagine/think you can do about it/IT? Or do you realise nothing, and accept diddly squat, and therefore are y'all practically impotent and pathetically ignorant too of your current situation and present existence, which is a virtual reality play controlled by virtual machines and searching algorithms ?

"Two things are infinite: the universe and human stupidity; and I'm not even sure about the universe."~~ Albert Einstein (1879-1955)

"Error is better than apathy. Error can be corrected in time to change the outcome. Apathy is seldom corrected until it is too late." – G. Edward Griffin


poldark's picture

Trilateralist Zbigniew Brzezinski (TC’s co-founder) wrote in his Between Two Ages – America’s Role in the Technotronic Era:

“people, governments and economies of all nations must serve the needs of multinational banks and corporations. (The Constitution is) inadequate….the old framework of international politics, with their sphere of influence….the fiction of sovereignty….is clearly no longer compatible with reality….”