Wednesday, March 15, 2017
Preet Bharara Explains Why He Let Wall Street Bank Executives Avoid Prison
Bharara was nowhere to be found when it came to charging the top executives whose actions led to the collapse of Lehman Brothers, Merrill Lynch and AIG, and who made all manner of misleading statements to cover up how sick their firms were. Goldman Sachs executives sold institutional investors a mortgage-backed security that sales staffers described as “one shitty deal.” Where was Bharara when it mattered most?
We don’t have to wonder for too long because the prosecutor explained his actions—or lack thereof—at a Crain’s forum three years ago. Bharara said at the time that he didn’t think he could win a case against Wall Street top dogs because they had hired advisers assuring them what they were doing was legal.
“What you do have to prove is criminal intent,” he said. “And it’s very difficult if a bank president has in his hands a letter or opinion from a law firm or accountant saying, ‘If you do X, Y and Z when you sell these mortgage-backed securities, you’re good.’
“Now it may make you angry,” he told the audience. “But if you have the opinion, it is a very difficult thing [for a prosecutor] when they say, ‘I asked my lawyers to do the best they could to tell me what I’m supposed to do.'”
Read those statements again. The leading white-collar prosecutor in the country said that advice from the right lawyer or accountant is tantamount to a get-out-of-jail-free card.