A new report from the conservative Government Accountability Institute (GAI) finds that President Barack Obama’s and Attorney General Eric Holder’s failure to criminally charge any top Wall Street bankers is likely a result of cronyism inside the Department of Justice and political donations made to Obama’s campaign.
Despite Obama’s and Holder’s “heated rhetoric” against Wall Street (in 2009, Obama blamed the 2008 financial collapse on “reckless speculation of bankers” while Holder charged that “unscrupulous executives, Ponzi scheme operators and common criminals alike have targeted the pocketbooks and retirement accounts of middle class Americans”), they haven’t “filed a single criminal charge against any top executive of an elite financial institution,” GAI wrote in its report, exclusively obtained by The Daily Caller.
GAI argues that the Obama administration’s decision to not go after Big Finance is due to senior DOJ leadership — Holder, Associate Attorney General Tom Perrelli, Associate Attorney General Tony West, Assistant Attorney General Lanny Breuer, Deputy Attorney General James Cole and Deputy Associate Attorney General Karol Mason — who “all came to the DOJ from prestigious white-collar defense firms where they represented the very financial institutions the DOJ is supposed to investigate.”
The report details how Holder and Breuer both came to the DOJ from Covington & Burling, a “top-tier Washington law firm” with a client list that includes financial firms like Wells Fargo, J.P. Morgan Chase, Bank of America, CitiBank, Deutsche Bank, Goldman Sachs, ING, Morgan Stanley, UBS and Wilmington Trust.
GAI said that President Obama’s decision to choose Holder, “a white-collar defense attorney from Covington,” as his attorney general, over a “more fiery prosecutor,” appears to have sent “a subtle signal to the financial community” that this administration isn’t going to actually do anything, despite the harsh words.
Cole, the report outlines, was with Bryan Cave LLP — “a white-shoe firm with A-list clients” — before becoming Holder’s right-hand man at the DOJ. One of Cole’s clients while at Bryan Cave LLP, the GAI report shows, was insurance and financial giant AIG.
Cole had done $20 million worth of work for AIG between 2004 and 2008, but his close ties with the company — which was “at the heart of the financial crisis largely because of its noncompliance in regulatory and compliance issues” — didn’t stop Obama or Holder from welcoming him aboard their administration.
The Obama administration’s decision to not appoint an independent counsel to investigate the MF Global scandal, despite more than 60 members of Congress demanding it, also reeks of cronyism, the GAI report details. Obama bundler and former Democratic New Jersy Gov. Jon Corzine was at the center of MF Global.
GAI points out how West — the DOJ’s no. 3 official — worked as a white-collar defense attorney for Morrison and Foerster before he came to the DOJ. Morrison and Foerster is currently providing legal representation to MF Global. Holder and Breuer’s old law firm — Covington & Burling — provided legal services to MF Global too, before MF Global sought bankruptcy protection.
GAI adds that the appearance of MF Global cronyism is “further complicated” by how Reid Weingarten — an attorney at Steptoe & Johnson — was selected to be MF Global treasurer Edith O’Brien’s lawyer.
“Weingarten previously served as Holder’s attorney following the controversial pardon of Marc Rich in the Clinton Justice Department,” the GAI report reads, adding that the blog Main Justice points out how Weingarten is “one of Holder’s best friends.”