Judge Jed Rakoff gave a keynote address last week to a conference hosted by the Centre for Law, Markets and Regulation (CLMR) at the University of New South Wales.
The influential judge from the Southern District of New York spoke about the flawed rationale for non-prosecution of offences related to the Global Economic Crisis. Judge Rakoff explained, as far as he is aware, the Department of Justice in the US has taken the position that no crime was committed in connection with the events leading up to the financial crisis. Their public position is that they could not indict for three reasons, some of which may be familar to the Irish case.
The first claim is that they cannot prove knowledge and intent at a senior management level. The second reason that the DoJ has given is that there were no immediate victims, in the sense that the purchasers of the sub-prime securities were themselves sophisticated investors. The third argument offered by the DOJ is that the institutions themselves are too big to fail and criminal actions would undermine confidence in a very uncertain financial market.
A podcast of his speech can be found at the CLMR website.
Nathan Lynch of Thomson Reuters, Of Crimes and Crises: Prosecutorial Imperatives and Political Conflicts, report of Judge Rakoff’s speech.
2 thoughts on “Judge Jed Rakoff on the Limits of Prosecution”
All three reasons given make no sense. They only make sense from the perspective of white collar criminals WCC’s deciding to agree to let each other off with criminal frauds having, in many cases, already received large salaries, bonuses and pensions contributions for their breaches of fiduciary responsibilities. In Ireland, we have been told that there is no prosecutable tort that allows bankers and financiers to be prosecuted for financial recklessness, some would say criminality. They make the rules so therefore the rules say that, they always get away and that everybody else must pay. Democracy has reached its end game.
Surely this post should be called ‘the limits of plea bargaining’?