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Project on Government Oversight
April 14, 2011

New Reports Put Financial Regulators in the Hot Seat
By Michael Smallberg


We wanted to highlight two must-read stories that came out today on the key causes of the financial crisis and the alarming absence of criminal prosecutions for the major players who drove the economy to the brink of collapse. The first is a front-page story in todayís New York Times that thoroughly documents the drop in criminal referrals by financial and banking regulators in recent years. Drawing on data compiled by the Transactional Records Access Clearinghouse (TRAC), the article raises troubling and largely unanswered questions about recent changes in the federal governmentís approach toward prosecuting white-collar crime (full disclosure: TRAC co-director David Burnham is a POGO board member). The lack of criminal referrals by our nationís top regulators, widely observed by financial commentators and legal experts, is thoroughly documented in TRACís data: The universityís Transactional Records Access Clearinghouse indicates that in 1995, bank regulators referred 1,837 cases to the Justice Department. In 2006, that number had fallen to 75. In the four subsequent years, a period encompassing the worst of the crisis, an average of only 72 a year have been referred for criminal prosecution....


Transactional Records Access Clearinghouse, Syracuse University
Copyright 2011
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