Whitewashing Wall Street crime: 'Useless' Yates memo in Justice Department is a day late and billions of dollars short

Signs of the Times
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This week, the Justice Department felt the need to write a memo to staff instructing them to indict individuals when they commit crimes, seemingly something implied by their job titles. It doesn't say as much about the current Justice Department regime under Loretta Lynch as it does about the former one under Eric Holder. No major Wall Street executive went to jail for the illegal actions that precipitated the financial crisis, despite a mountain of documentary evidence of fraud. Corporations and their employees got away with what amounted to slaps on the wrist. And Holder, after presiding over this, joined the head of his Justice Department criminal division and several top deputies at Covington & Burling, a white-collar defense firm that represents most major banks. You can draw a direct line from this failure back to the "Holder memo," written when he served as a deputy in the Clinton Justice Department. That memo created the "collateral consequences" policy, arguing that prosecutors who seek criminal cases against large companies should take into account innocent victims who may get hurt. It laid out a host of alternative remedies, such as fines and deferred prosecution agreements. This eventually gave prosecutors a way to shrink from complex cases, to talk themselves into not wasting the effort. The working theory inside the Holder Justice Department was to only go after cases where victory was absolutely assured, and where collateral damage was minimized. And this philosophy drifted to preventing prosecutions of individuals as well, even though there's no shred of evidence that sending an executive to jail would sink a company (or that juries won't be able to understand complex cases against individuals, for that matter). This Holder doctrine has soured opinions of the Justice Department, giving the impression that it serves only to protect the rich and powerful from the consequences of their actions. It's a perception that DoJ wants to correct, which is why it made the "Yates memo," named after Deputy Attorney General Sally Yates, public.

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