And Then There's This: "The Oceans Will Rise; Nuclear Winter Will Be Upon Us; And The World As We Know It Will End"

Tyler Durden's picture

As U.S. Justice Department prosecutors begin to bring the first criminal charges against global banks since the financial crisis, they are facing dire warnings of uncontainable collateral damage from none other than the sell-side's banking analysts... "Don’t play with matches," warned Brad Hintz, bringing up the specter of Enron (somehow suggesting we would better if that had not been prosecuted?) “The mere threat of requiring a hearing could cause customers to lose confidence in the institution and could cause a run on the bank,” warns a banking lawyer (well isn't that how it's supposed to be?). Too Big To Prosecute is starting to tarnish a little as Preet Bharara begins to bring the heat, adding, somewhat humorously that, banks have a "powerful incentive to make prosecutors believe that death or dire consequences await."

It seems Eric Holder's words - as we noted here...

"But I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy. And I think that is a function of the fact that some of these institutions have become too large.


Again, I'm not talking about HSBC. This is just a -- a more general comment. I think it has an inhibiting influence -- impact on our ability to bring resolutions that I think would be more appropriate. And I think that is something that we -- you all need to -- need to consider. So the concern that you raised is actually one that I share."

But now, as Bloomberg reports,

Stung by lawmakers’ criticism that multibillion-dollar settlements have done too little to punish Wall Street in the wake of the financial crisis, prosecutors are considering indictments in probes of Credit Suisse Group AG and BNP Paribas SA, a person familiar with the matter said.

And that has led to significant backlash from the industry - how dare he!!

The 2002 collapse of Arthur Andersen, the accounting firm indicted in the Enron scandal, “should be a lesson” for prosecutors, Brad Hintz, an analyst at Sanford C. Bernstein & Co., said today in an interview on Bloomberg Television. “Don’t play with matches.”




Criminal action would have to be handled so that any review of a bank’s charter wouldn’t spook customers or revoke a firm’s license, said Gil Schwartz, a partner at Schwartz & Ballen LLP and a former Federal Reserve lawyer. “The mere threat of requiring a hearing could cause customers to lose confidence in the institution and could cause a run on the bank,” Schwartz said.

And as Preet Bharara somewhat comedically notes...

“Companies, especially financial institutions, will do almost anything to avoid a tough enforcement action and therefore have a natural and powerful incentive to make prosecutors believe that death or dire consequences await,” he said. “I have heard assertions made with great force and passion that if we take any criminal action, the skies will darken; the oceans will rise; nuclear winter will be upon us; and the world as we know it will end.”

But the threats arnd fears of what is clearly TBTF's contagious effects remain...

“You can’t do a guilty plea of a systemically important financial institution without first getting the regulators on board a commitment that the conviction won’t put the bank out of business,” he said in an e-mail. “That seems to be going on here, not surprisingly.”

And this is with stocks at record highs and the entire farce of opaque bank balance sheets now a dim and disatnt memrory for all but the sanest.

“These are test cases,” said Phan. “There’s a pragmatism behind this. You look for a target that’s small enough and that will send a message.”


Prosecuting banks would break with a practice of brokering settlements with companies that are considered integral to the financial system. Previous probes were resolved through so-called non-prosecution and deferred-prosecution agreements, which have been criticized by U.S. lawmakers for failing to hold banks accountable.


“It’s about time,” said Buell, who was part of the prosecution team at the trial of Arthur Andersen, whose indictment put about 85,000 people out of work. “The argument that we can’t have guilty pleas because of debarment provisions that are written into various regulatory codes has always seemed to be a case of the tail wagging the dog.”

So, to summarize, regulator is actually taking a crack at the TBTFs for fraud they committed and the industry is in full Mutually Assured Destruction threat mode should it actually be forced to admit guilt... well played Fed... more leveraged, more interconnected, and more TBTF in the world's economy...

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jomama's picture

thanks for the ray of sunshine on a thursday, bitchez.

Vampyroteuthis infernalis's picture

It is simple as this. When the criminal banks made money for everyone, the elites turned their backs on shady behavior. Now the pie is smaller. Shady dealings are reaching into the back pockets of the elites. Time to stop this crap!

nope-1004's picture

Hang'em all.  Bring on the bank runs.  Fuck the criminals.  Die already.  Usher in honor, integrity, and service.

F'n asshole banks.  So obviously crooked and corrupt.


BobPaulson's picture

Call in the modern day Robespierre.

Pladizow's picture

“The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.” - Lord Acton 1834-1902

“Banking was conceived in inequity and was born in sin. The bankers own the earth. Take it away from them, but leave them the ability to create money and with the flick of the pen they will create enough deposits to buy it back again. However, take it away from them, and all the great fortunes like mine will disappear and they ought to disappear, for this would be a happier and better world to live in. But if, you wish to remain the slaves of bankers and pay the cost of your own slavery, let them continue to create money.” - Sir Josiah Stamp, Director of the bank of England in 1928, reputed to be the 2nd wealthiest man in England at the time.

ParkAveFlasher's picture

Bring on the Dark Times.  Bring it, bitchez.  Got my gold, my silver, my friends, my nutzak, and most importantly, HH's hobby farm!

Keyser's picture

Ok, so we skip prosecution and jump straight to the beheadings...


Manthong's picture

"The Oceans Will Rise; Nuclear Winter Will Be Upon Us; And The World As We Know It Will End"

That may not be far from the reality.

To my understanding, many (most?) of the largest pension funds have stipulations in their charters that if a senior exec in an institution in which they are invested is criminally convicted, they must pull their funds.

So tell me, please.. what would happen to JPM or GS and their > $ 100 Trillion of notional CDO’s if Jamie or Lloyd were convicted of one of their crimes and CalPERS amongst others yanked their funds out?

.and then what other fun would ensue with the entire quadrillion or so worth of interdependent CDO’s?

..likely, it would then be a “Yippee-ki-yay, MF” moment.  

So you wonder why they all seem to have a smirk on their faces?

espirit's picture

Fuck it, anyone claiming to have been a banker in the next life is gonna get a sharp stick through the eyepiece of his gasmask.

Dixie Rect's picture

Hush Harriet, that's a sure way to get him killed

old naughty's picture


"The Oceans Will Rise; Nuclear Winter Will Be Upon Us; And The World As We Know It Will End"

That may not be far from the reality.


Ok, i got that, the reality...

But i don't get the world as we know it will end bit.

What do we know (or rather, what do we don't know)?

So "we don't know" will end?

StychoKiller's picture

The Philistines thought they had gotten rid of their Samson problem until...

centerline's picture

Don't forget the secret recipe for wolf nipple chips.  It's a must have.

Adahy's picture

I miss his comments.  I wish he had a blog or something I could follow and talk gardening with.

Pairadimes's picture

“I believe that banking institutions are more dangerous to our liberties than standing armies. “ - Thomas Jefferson

Dick Buttkiss's picture

The American empire is nothing if not the sociopathic synthesis of monopolized money and metastatic militarism.

McMolotov's picture

Earlier today we had the article about how the IMF essentially told Ukraine to go to war or it wouldn't get a loan. Now we have TBTF banks threatening mass destruction if they're ever prosecuted.

Way to reveal your true colors, banker assholes. Hope you sleep well knowing that when it all comes down, you'll have big-ass targets on your backs.

Ignatius's picture

Banker's war.

Has anyone else noticed how over-the-top friendly and courteous the staffs at the banks have been these last few years since the bailouts?

greatbeard's picture

Actually, yes, I've specifically noted that.

tonyw's picture

The low level bank staff are just like JSP, they haven't got a clue and are certainly not part of the elite.


NoDebt's picture

I say we test this threat and let the chips fall where they may.  Let's start the Wells Notices, perp walks and jail time.  If the world starts to go all fire-and-brimstone, OK, we back off a little.  BUT I BET IT WON'T.

dontgoforit's picture

What Holder was really saying is: "I ain't touching that shit.  I'll be as disappeared as Jimmy Hoffa."

Bindar Dundat's picture

Interesting that the real attraction for digital currencies like bitcoin is that you can become your own bank without a reserve,,,,,


Maybe this BTC thing isn't all bad :-)

marathonman's picture

That's a nice economy you got there.  Wouldn't want anything to happen to it now would you?  It's not my nuts in the vice come election season when you have to try to get voters to re-elect your sorry ass in an economy in free fall.  See how that worked for George W. Bush....

V in PA's picture

GWB was elected twice. Maximum allowable time under the law. I don't get your point.

drendebe10's picture

GWB was/is dumber than a box of old cat turds....  but at least he didn't try to destroy the country at an accelerated pace like the corrupt, arrogant, narcissistic, lying, illegal alien indonesian kenyan muslim sociopath fudge packer in chief with repeated divisive lies and coverups,  feebies for freeloaders and illegal aliens (including itself with its grand imperial golf life style), lying gummin officials, obamascare. and on and on and on and on...

pods's picture

You are missing the strings my friend.  

They are not dancing of their own volition.


11b40's picture

Oh , really? I don't see a lot of difference between the 2.

Pickleton's picture

The difference? Hat tip to whomever it was I stole this from.

If the GOP were in charge unopposed, life would really suck.

If the Demcorats were in charge unopposed, there would be book burnings and death camps within the week.

- Thumbs up if you agree, thumbs down if you're wrong. lol.

Terminus C's picture

red, blue, red, blue... false dichotomy dude.  You're gonna get down arrows because you are dumb, not because other people believe the Blue team is better than the Red team.

Jadr's picture

This *DB^JPM derivatives books.

Bemused Observer's picture

My feelings about Democrats and Republicans can be summed up in the following...

There are 2 guys who are after you. You know that they really really want to get you into bed, and each makes all kinds of promises that you know are bullshit. How do you choose between them? 

Since you realize that neither are likely to commit to you, and all you're going to get out of the deal is one date night, you decide to give each his chance to woo you.

The Democrat shows up, on time, and with flowers and candy. He tells you you look lovely, makes friends with your cat, and wisks you off to a fabulous restaurant. After dinner and dancing, he brings you back home, and tenderly seduces you. He makes love to you all night long, until you finally drift off with a smile on your face.

When you wake up, he's gone. So is your wallet and credit cards. Then the restaurant calls, and you discover he stuck you with the bill. And he left the door open so your cat got out.

The next night, the Republican shows up for his date-night. No flowers, no candy, and when you answer the door he grabs you by the face and throws you to the floor, where he rapes you in front of your cat. When he's finished, he forces you at gunpoint to make him dinner, and right before he leaves, he throws you a few crumpled bills "for your trouble", and leaves. He leaves the door open and you cat gets out.

Now, if your choice is between one or the other, and you're pretty sure that no matter what choice you make you will definitely get fucked and lose your cat in the end anyway, which one would YOU pick?

Sometimes we don't choose something because we think it's the BEST choice. Sometimes we are just going with the better of 2 unpleasant choices. In the above, the Deomocrat would be my choice, as his approach is friendlier. It doesn't mean that I believe his bullshit, or take him seriously. It's just that HIS approach is a bit easier to tolerate.

Yes, the Democrats are that first guy. Phonies who promise you the world and lie through their teeth, And the Republicans are the hard-assed realists who cut all the fancy crap and get right to the point. Either way you get fucked...the only difference is that the Democrat DOES at least try to make it SOMEWHAT pleasant for you.


Chewybunny's picture

Which party would let me keep my cat?

Bemused Observer's picture

Neither, that's the point. Either choice gets you to the same place, it's only a question of whether you get force-marched at gunpoint or if they allow you a semblance of choice and few minor comforts along the way. Both Dems and Repubs are determined to take us to the same place, but at least the Dems will let you ride in a cart, and give you water and peanuts for the trip. And my greater point was that not all voters go with a side because they think it's a good choice. It's just the better of the available choices for them.


El Crusty's picture

the reason Obama is so much more destructive-
Bush knew he didnt know what he was doing- let other people under him make those decisions.
Obama thinks he knows what he's doing and completely ignores everyone the advice of everyone around him- until election time.

SF beatnik's picture

GWB is starting to look pretty good, now. I miss him.


He was smart enough to know he was, relatively speaking, a dummy who should just read the speeches given to him and then shut the fuck up.


He read them well, too. At least give him that much credit. 

wisefool's picture

So hank said there would be tanks on the streets if the IRS did not go out and stick guns in the faces of americans, to collect a TARP fund for the banks.

The IRS did that. The banks got TARP, GM got bailed out, Bernake sent a couple hundred billion to europe with no idea who got it. etc. etc.

The demands were fully complied with. But 5 years later law enforment around the country is getting tanks (MRAPs) Federal and local agencys have purchased billions worth of heavy and light ammo.

You pretty much just have to assume when they make a "or else"  threat, they are just foreshawing the next demand.

centerline's picture

And there you go, connecting dots.  Making all sort of "logical" conclusions and all.  Using ye old cranial capacity.  I think that is now a form of domestic terrorism or something.  

Keyser's picture

It is no joke with the proposed new program that would have gubbamint stooges scouring the internet for "hate speech"... 

Flagit's picture

Intellectual Terrorism

giggler321's picture

Well it just shows you it didnt work and they know it

Antifaschistische's picture

just close the discount window and forget the prosecutions...prosecution is the parasite legal community 1%ers shaking down the parasite banking community .01%.

just close the discount window.

NotApplicable's picture

I think you mean, "look tough against foreign banks."

A.K.A. "that's why Jamie Dimon is richer than you are."