5 Big Banks Expected to Plead Guilty to Felony Charges

For most people, pleading guilty to a felony means they will very likely land in prison, lose their job and forfeit their right to vote.

But when five of the world’s biggest banks plead guilty to an array of antitrust and fraud charges as soon as next week, life will go on, probably without much of a hiccup.

The Justice Department is preparing to announce that Barclays, JPMorgan Chase, Citigroup and the Royal Bank of Scotland will collectively pay several billion dollars and plead guilty to criminal antitrust violations for rigging the price of foreign currencies, according to people briefed on the matter who spoke on the condition of anonymity. Most if not all of the pleas are expected to come from the banks’ holding companies, the people said — a first for Wall Street giants that until now have had only subsidiaries or their biggest banking units plead guilty.

Read More At: http://www.nytimes.com/2015/05/14/business/dealbook/5-big-banks-expected-to-plead-guilty-to-felony-charges-but-punishments-may-be-tempered.html?_r=0

As the Times reports, “Behind the scenes in Washington, the banks’ lawyers are also seeking assurances from federal regulators—including the Securities and Exchange Commission and the Labor Department—that the banks will not be barred from certain business practices after the guilty pleas.”

In particular the banks are seeking waivers to retain their status as “well-known seasoned issuers,” allowing them to raise credit more easily, as well as the ability to operate mutual funds. The Times reports that “a majority of commissioners” of the SEC are in favor of granting such such waivers.

In fact, for the biggest corporations, being convicted of a felony is increasingly becoming legally irrelevant, and just one element of their normal operations. As the Times points out, the guilty pleas are merely “an exercise in stagecraft.”

One former Justice Department official told the Times that an “underlying assumption” of the Justice Department is that “the bank is not a criminal operation.” But the emergence of scandal after scandal, including the selling of toxic mortgage-backed securities that caused the financial crisis, the forging of foreclosure documents, widespread complicity in Bernard L. Madoff’s Ponzi scheme, money laundering, and tax evasion by Wall Street testifies to the fact that the banks are, in fact, criminal outfits.

Since taking office shortly after the onset of the financial crisis, the Obama administration has sought not to hold the banks to account and prevent criminal wrongdoing, but rather to conceal their crimes and, when this becomes impossible, to issue wrist-slap punishments that allow the banks to go on largely as before.

Read More At: http://www.informationclearinghouse.info/article41863.htm