Banks Pay Bupkis for Roles in Crisis
Posted on Mar 8, 2012
Bank of America: $11.9 billion; JPMorgan: $5.44 billion; Wells Fargo: $4.35 billion. These are the fines the banks have paid so far in settlements to the government for wrongdoing amid the financial crisis, recorded as part of ProPublica’s loose, ongoing effort to order the major facts and figures of the disaster.
Of course, to begin to tell whether these penalties come anything close to fair, they have to be considered against each bank’s existing assets. According to Investopedia, Bank of America held $2.26 trillion in valuables in 2010. JPMorgan counted $2.29 trillion, and Wells Fargo had a measly $1.26 trillion in the bank. Those figures stand in addition to the tens of billions each group carries in equity.
And as it’s said below, the SEC permitted banks to pay the settlements quietly, without declaring themselves innocent or guilty.
So what are these punishments? Slaps on the wrist? And do they even come close to recovering the cost in terms of dollars lost and lives ruined among the American public? —ARK
In the case of the SEC settlements we list here, the firms neither admitted nor denied the charges when agreeing to the terms of the settlement. (The SEC’s habit of letting banks sidestep the question of culpability has been widely criticized.)
Overall, the SEC says it has brought in almost $2 billion in penalties as well as money for investors from settlements related to the crisis, and the Department of Justice lists dozens of criminal cases it has brought against smaller players. And the investigating isn’t over yet. The SEC recently sent notices of possible charges to JP Morgan Chase, Goldman Sachs, and Wells Fargo, and the DOJ reportedly has issued subpoenas to eleven financial institutions related to mortgage securities.
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