Too Big to Jail: Inside HSBC, the Mexican Drug Cartels and the Greatest Banking Scandal of the Century

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Garrett’s title plays on the popularized phrase “too big to fail,” which was commonly used after the recent financial crisis to describe the fear that the biggest banks are so critical to the global economy that the government has no choice but to save them from total collapse. This idea resonates within the walls of the Justice Department as well, argues Garrett, as some prosecutors are not holding large corporations accountable for crimes because of their importance to the worldwide financial system. But Garrett’s book doesn’t only focus on banks. He makes a compelling argument that the “too big to jail” concern spreads beyond the banks. It applies to many other large corporations such as pharmaceutical companies, oil and gas companies, and consulting companies. He also argues that the concern “extends to whether officers and employees are held accountable; they can literally be put in jail.” The final chapter touched on how some of the HSBC fines were put to good use to various law-enforcement agencies in the US. For readers coming to this chapter, one will surely agree to the author's view on the case as quoted below ... Watch The Untouchables, FRONTLINE’s look at why no Wall Street executives have been prosecuted for fraud in connection with the financial crisis. Lord Sikka is an emeritus professor of accounting at the University of Essex and the University of Sheffield

And so the interrogations began. “We’d drag him out of prison and feed him,” Mazzilli recalled. “He was always friendly…It was hard not to like the guy.” The two men built a rapport, especially when they realised that Ramos had lived for a while in the same Long Island suburb where Mazzilli had grown up.When Roschacher was asked if he made a mistake by pursuing the banker based on Ramos’s word, he noted that the case ran on long after he had resigned. “I am responsible as the then attorney-general for the beginning of the case. But I’m not responsible any more for bringing him to court.” UK prepares new law to break up errant banks". Reuters. February 4, 2013 . Retrieved November 15, 2019. Holenweger was a man of humble origins. His father was a postman and his mother worked at a local grocery store. He never went to university, instead completing an apprenticeship in banking before going on to work in finance. During his mandatory service in the army, he rose to the senior rank of colonel (general staff). In 1998 he founded a new bank called Tempus Privatbank. United Press International (UPI), "Lagarde: 'Too big to fail' banks 'dangerous'" Retrieved April 13, 2013 a b "Greenspan Says U.S. Should Consider Breaking Up Large Banks". Bloomberg. October 12, 2009 . Retrieved February 5, 2010.

It creates an uneven playing field between big and small firms. "This unfair competition, together with the incentive to grow that too-big-to-fail provides, increases risk and artificially raises the market share of too-big-to-fail firms, to the detriment of economic efficiency as well as financial stability." I am concerned that the size of some of these institutions becomes so large that it does become difficult to prosecute them … When we are hit with indications that if you do prosecute, if you do bring a criminal charge it will have a negative impact on the national economy, perhaps world economy, that is a function of the fact that some of these institutions have become too large. It has an inhibiting impact on our ability to bring resolutions that I think would be more appropriate. This article was amended on 7 October 2021. The figures provided for convictions secured and deferred prosecution agreements (DPAs) entered into by the Serious Fraud Office were correct as of February 2021; they have now been updated. And one of those DPAs was in relation to Standard Bank, not Standard Chartered Bank as an earlier version said.

Ramos’s only indulgences were a rotating cast of attractive young women and American fast food. He enjoyed the all-you-can-eat buffet at Wendy’s. “He’d eat five plates,” said Chuck Mazzilli, a customs officer who once followed Ramos inside to observe him up close

When Roschacher was attorney-general he would exhibit his paintings under a false name. At each opening the gallery owner would declare, “Unfortunately, the artist is ill. He cannot attend.’” In reality, “I was there, but as a spectator,” he recalls with a smile. “They were undercover missions.” In a March appearance before the Senate Judiciary Committee, Holder testified that big banks’ clout “has an inhibiting impact” on prosecutions. As he explained: Note: In the wake of the 2023 banking crisis, the Swiss government facilitated an acquisition of Credit Suisse by UBS to avoid the former's collapse. UBS completed the acquisition in June 2023, thereby making Credit Suisse the first failure of a bank considered "too big to fail" since the Global Financial Crisis. [66] Notable views on the issue [ edit ] Economists [ edit ] Dayen, David (March 21, 2013). "Banks Are Too Big to Fail Say ... Conservatives?". The American Prospect . Retrieved March 23, 2013.

Even though you have been involved in drugs and drug dealing,' Judge Vinson told Ms. George, 'your role has basically been as a girlfriend and bag holder and money holder but not actively involved in the drug dealing, so certainly in my judgment it does not warrant a life sentence.' Banks are required to maintain a ratio of high-quality, easily sold assets, in the event of financial difficulty either at the bank or in the financial system. These are liquidity requirements. Mazzilli was still new to the job. He had previously worked as a military policeman and a us marshal, but had grown bored of disciplining drunk soldiers and escorting prisoners to courthouses. He wanted some excitement – and was about to get it.The term emerged as prominent in public discourse following the global financial crisis of 2007–2008. [5] [6] Critics see the policy as counterproductive and that large banks or other institutions should be left to fail if their risk management is not effective. [7] [8] Some critics, such as economist Alan Greenspan, believe that such large organizations should be deliberately broken up: "If they're too big to fail, they're too big." [9] Some economists such as Paul Krugman hold that financial crises arise principally from banks being under-regulated rather than their size, using the widespread collapse of small banks in the Great Depression to illustrate this argument. [10] [11] [12] [13] He was a big fish when we got him. We didn’t know how big. It’s almost unbelievable that we’re sitting here talking to this guy” Salinas served ten years of a 27-year sentence for assassinating his former brother-in-law before the verdict was overturned (he was never convicted of drug-smuggling or money-laundering). In December 2014 a federal court in Mexico exonerated him of “unjust enrichment”. By the time Salinas’s slate was wiped clean, however, Ramos was long gone. When he again requested a reduction in his sentence in June 2000, a judge agreed to cut it to 12 years. Mazzilli was astounded. “You don’t really see guys who have two life sentences and 20 walk out of jail,” he said. “But he did.” This two-tiered justice system was the subject of my last book, "With Liberty and Justice for Some", and what was most striking to me as I traced the recent history of this phenomenon is how explicit it has become. Obviously, those with money and power always enjoyed substantial advantages in the US justice system, but lip service was at least always paid to the core precept of the rule of law: that - regardless of power, position and prestige - all stand equal before the blindness of Lady Justice. As officers burst in, Salinas told his own bodyguards to stand down. He was escorted out of the house with his head bowed and taken to an isolation cell in Mexico’s most secure penitentiary. It was the first time in modern Mexican history that anyone so close to a president had been charged with an offence of such magnitude.