It was big news two weeks ago when investigators arrested Sean FitzPatrick, the former chairman of Anglo-Irish Bank, and announced new criminal charges against him. FitzPatrick has been widely cast as the man who nearly bankrupted Ireland, and his July 24 arrest adds 16 counts relating to a conspiracy to prop up the stock price of the now-defunct bank.
Didn’t hear about it? I don’t think I would’ve, either, had I not been in Ireland when it happened. The US media barely covered it.
But throughout the British Isles, it was front-page news, the headline story of TV news programs, all the talk on talk radio. A bank executive facing criminal charges!
That night, I watched the evening news in the house of my Irish friend, Mary. As I was watching all I could think was: When are we in the United States going to start indicting the financial executives who caused our economy to crash?
Just then, Mary interrupted my pie-in-the-sky thoughts by saying something about how Ireland was taking its cues from America’s get-tough stance on criminal bankers. I wish that were the case. So far, it’s just been talk. To this date, not one American bank executive has been arrested for his or her involvement in the global financial crisis.
In Ireland, the collapse of Anglo-Irish Bank cost taxpayers there $36 billion, which is about $8,000 for every man, woman, and child in Ireland. When the bank collapsed — not least because of the manipulations at issue in the many charges that FitzPatrick faces — it put Ireland’s economy into a tailspin.
Unemployment now hovers at 15 percent. The Irish are singing mournful songs again about loved ones migrating elsewhere for work. But the country has a plan to reimagine itself, and part of the plan seems to be criminalizing those responsible for gambling away other people’s money and conning poor people into taking predatory loans.
When will we follow suit?
In 2009, President Obama created the Financial Fraud Enforcement Task Force. According to its website, its mission is to “hold accountable those who helped bring about the last financial crisis as well as those who would attempt to take advantage of the efforts at economic recovery.” The task force has charged some bottom feeders, like last Friday’s arrest of a Connecticut woman who allegedly bilked $2 million from elderly people in a Ponzi scheme disguised as an investment.
They also went after the CEO of an Iowa brokerage firm who allegedly embezzled $200 million from customers. The CEO tried to kill himself, but failed. After investigators found his suicide note, in which he gave a detailed admission of his crimes, they charged him on July 13. It helps to have a hand-written confession, of course. Experts say “complex financial instruments” — a polite term for toxic securities — are so confusing that it’s hard to understand how they work, let alone tie them to a particular crime.
Still, investigators couldn’t ferret out a single fat cat from Wall Street?
Instead, we’ve had civil settlements. In February, the White House and state attorneys general agreed to a $25 billion deal with the nation’s five biggest mortgage servicers. There have been other settlements involving other companies, as well. But compared with the damage done to the economy, the amount of money involved is peanuts. And the basic cause of the 2008 financial crash in the United States — the widespread practice, enabled by major financial institutions, of putting people into fraudulent, unsupportable loans — has gone unpunished.
So what are we waiting for? If we hope to end corrupt banking practices, those who perpetrated them need to be investigated and charged.
If the Irish can do it, so can we.
Cindy E. Rodríguez is a Journalist-in-Residence at Emerson College.