Bloomberg View: The Case for Punishing Bad Bank Behavior
Regulators should be more aggressive, not less, in going after Wall Street misdeeds
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Five years after the global economy was sucker-punched by the bankruptcy of Lehman Brothers, has the U.S. done enough to prevent financial companies from breaking the law? If not, what else can it do to deter misconduct—and motivate shareholders to demand changes?
For years the Department of Justice has been reluctant to punish large corporations for fear of driving them out of business. (Remember Arthur Andersen?) The department has instead relied on so-called deferred prosecutions, which usually involve signed promises not to misbehave and the acceptance of on-site monitors to check on compliance.