Danny Vinik wishes the soon-to-be-ex AG had taken on Wall Street:
Prosecuting the banks with their well-funded legal teams for criminal crimes wouldn’t have been easy. But the DOJ has a lot of legal firepower as well. Holder simply never tried to use it to hold Wall Street executives accountable. That is a major blemish on Holder’s record. Bankers sleep easier at night thanks to his decisions. And when the next financial crisis hits—and when we discover that financial fraud was a major cause of it—Holder will deserve blame as well.
Wonkblog explains Holder’s reluctance to tackle the banks:
In defense of his agency, Holder has stressed the difficulty of bringing criminal charges against top-level executives who are rarely involved in the day-to-day operations of their firms. Prosecutors, he has said, need evidence of culpability, the kind of proof that often comes from cooperating witness or whistleblowers. Just last week, Holder called for Congress to increase the whistleblower award as an incentive for Wall Street executives to come forward with information.
Danielle Kurtzleben adds more rationales:
There are all sorts of reasons why the department might have been timid — going up against banks’ well-funded legal defense teams would be tough, particularly when trying to prove wrongdoing to a jury in the byzantine world of finance, says James Angel, associate professor at the Georgetown University McDonough School of Business. In an article in the July/August edition of Politico Magazine, Glenn Thrush writes that a test criminal case against bankers ended in an acquittal, which scared Holder away from actual prosecution against individual bankers.
In addition, the Justice Department simply had a lot of other things on its plate in the last few years: terrorism and voting rights, for example. But if the Obama DOJ simply doesn’t have the manpower to handle all of the problems thrown at it, that may signal that it’s time for a new structure, says one expert.