Preet Bharara Explains Why He Let Wall Street Bank Executives Avoid Prison

Authored by Mike Krieger via Liberty Blitzkrieg blog,

Recently dismissed U.S. Attorney for the Southern District of New York, Preet Bharara, is suddenly being celebrated as an aggressive warrior in the fight against Wall Street corruption.

Really? You could’ve fooled me. Perhaps I was in a coma when a string of big bank executives were arrested and sent to prison.

No, what actually happened is one of the most powerful attorneys in the nation came up with a mealy-mouthed, cowardly rationale for why he let these financial thieves off the hook.

Crain’s reports:

 Bharara was nowhere to be found when it came to charging the top executives whose actions led to the collapse of Lehman Brothers, Merrill Lynch and AIG, and who made all manner of misleading statements to cover up how sick their firms were. Goldman Sachs executives sold institutional investors a mortgage-backed security that sales staffers described as “one shitty deal.

Where was Bharara when it mattered most?

We don’t have to wonder for too long because the prosecutor explained his actions—or lack thereof—at a Crain’s forum three years ago. Bharara said at the time that he didn’t think he could win a case against Wall Street top dogs because they had hired advisers assuring them what they were doing was legal.

“What you do have to prove is criminal intent,” he said. “And it’s very difficult if a bank president has in his hands a letter or opinion from a law firm or accountant saying, ‘If you do X, Y and Z when you sell these mortgage-backed securities, you’re good.’

“Now it may make you angry,” he told the audience. “But if you have the opinion, it is a very difficult thing [for a prosecutor] when they say, ‘I asked my lawyers to do the best they could to tell me what I’m supposed to do.’”

Read those statements again. The leading white-collar prosecutor in the country said that advice from the right lawyer or accountant is tantamount to a get-out-of-jail-free card.

Jesse Eisinger, a Pulitzer Prize–winning business reporter, will soon have a book out explaining how federal prosecutors lost their nerve to bring Wall Street leaders to justice. Its title is The Chickenshit Club.

Now that sounds like a book worth reading.

And make sure to read Chain of Title by David Dayen as well to get the full picture on the events that led to our current reality.

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