The list of crimes committed by large banks is long: money laundering for terrorists and drug cartels, manipulation of interest rates to defraud investors, rigging commodities markets to raise the prices you pay, mortgage fraud (including breaking state and federal laws when kicking people out of their homes and foreclosing on them), and manipulating municipal debt markets. And these are just the ones we know about.
Yet no bankers have actually gone to jail for these crimes. No wonder people believe the system is rigged — it is!
So it comes as little surprise when during testimony in front of Congress, one of the top bank regulators admits that not only have they been afraid to prosecute bankers for fear that doing so would cause damage to the financial system, but in fact they don’t even think that it is their job to do so. William Dudley, the president of the Federal Reserve Bank of New York, said that he didn’t think that the focus of bank regulators was to act like a cops or to investigate banks. Instead, their primary focus is “ensuring that the bank is safe and sound, that it’s run well”.
I guess Dudley just guaranteed himself a high paying job at a big bank when he leaves the Fed.