Danny Schechter - ColdType

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package of financial reforms and Congress has passed new
regulations is to head off public outrage. The politicians could
see which way the wind was blowing – in their faces.
Coffee explained, “We have a virtual revolutionary mood
which partly explains the dramatic action taken by the President
to restrict compensation and bail out firms. So I’m not
surprised there is now anger.”
When the lead story in the New York Times was, “Financial
Fraud Rises as Target for Prosecutors,” one of the columnists
was reporting, “the fury of ordinary Americans was bubbling
up at those who continue to plunder our economy.”
Suddenly the word plunder was in wider use as protests,
demanding justice, spread worldwide.
Many firms prefer to settle complaints rather than admit
wrongdoing. Goldman Sachs paid Massachusetts $60 million
rather than admit they had designed their mortgages to fail.
Investigative financial journalist Gary Weiss, who has investigated
Wall Street crimes in several books told me, “That’s
standard. It’s standard when Wall Street firms negotiate, what
are in effect, plea-bargains with regulators, so the firms do not
have to admit guilt.”
Part of the problem, says Professor Coffee, is the way laws
are written: “Any criminal prosecution for fraud requires that
you show not only that investors lost and investors were outraged
but you have to show a level of culpability by the manager
that you wish to indict. You must show either a specific
intent to defraud or, what federal law calls, willfulness which
means a real intent to deliberately defraud someone and
engage in misconduct that you realize was causing injury.”
I pressed him, “So if somebody had the best intentions in
the world but still defrauded large numbers of people they
can’t be prosecuted?”
“Not criminally.”