Elizabeth Warren challenges candidates to prosecute corporate crime

31 January 2016 10:05 am

Senator professor Elizabeth Warren has made it clear what her platform would be if she were to run for president.

Warren has just released a booklet Rigged Justice: 2016 How Weak Enforcement Lets Corporate Offenders Off Easy detailing how the US Department of Justice failed to prosecute corporate crime.

The booklet details a number of cases spanning Wall Street: General Motors, Standard & Poor’s, Novartis and the cartel of Citigroup, JPMorgan Chase & Co, Barclays, UBS AG, and Royal Bank of Scotland. There was a conviction in only one case, the former CEO of Massey Energy Company. And that was for a misdemeanour. He was convicted following the Upper Big Branch mine explosion that resulted in 29 deaths.

“If justice means a prison sentence for a teenager who steals a car, but it means nothing more than a sideways glance at a CEO who quietly engineers the theft of billions of dollars, then the promise of equal justice under the law has turned into a lie. The failure to prosecute big, visible crimes has a corrosive effect on the fabric of democracy and our shared belief that we are all equal in the eyes of the law,’’ Warren writes.

She says that despite the Obama administration’s repeated promises to strengthen enforcement and hold corporate criminals accountable, the accountability for corporate crime has been shockingly weak.

For example, when JPMorgan Chase and five other banks pleaded guilty to criminal charges that they rigged the price of billions of dollars worth of foreign currencies, they were fined $5.8 billion between them. No one went to jail. Instead, JP Morgan Chase increased its CEO Jamie Dimon’s pay by more than a third to $27 million.

This is in a country that has the highest incarceration rates in the world, particularly for blacks.

Warren has been particularly critical of the US corporate regulator, the Securities and Exchange Commission. She says SEC chair Mary Jo White’s performance as Wall Street’s top cop is “extremely disappointing”.

Writing in the New York Times at the end of the week, Warren says institutions enforcing the law are run by people nominated by the US president and confirmed by the US Senate. It comes down to one issue: personnel is policy.

“Legislative agendas matter, but voters should also ask which presidential candidates they trust with the extraordinary power to choose who will fight on the front lines to enforce the laws,’’ Warren writes.