Too Big To Jail? Obama Administration Agrees To Large Penalty In Exchange For Letting Billionaire Escape Insider Training Charge While His Subordinates Plead Guilty

800px-Louis14-FamilyJohn Cassidy has a remarkable story out in the New Yorker this week about a sweetheart deal cut by the Justice Department with one of the wealthiest men in the world, Steven A. Cohen (who may be pictured here at a standard picnic, or not). Cohen’s company would pay $626 million but not have to admit any wrongdoing and Cohen would face no personal sanction. The billionaire appears to be celebrating this month with a buying spree with a Picasso painting and a huge new mansion. What is amazing is that various Cohen subordinates have pleaded guilty and Cohen has been tied directly to an insider trading allegation. Yet, he appears to “too big to jail” as a continuation of the Obama Administration’s bifurcated legal system for the super rich and the rest of us.

This is a standard ploy in which a sweet deal is reached to protect a powerful individual by setting a huge penalty to be paid by his company. The Obama Administration has been flogging the size of the payment to distract attention from the fact that Cohen will be left entirely untouched.

There is still a chance that the judge presented with this settlement could reject it for lack of any admission of guilt. Judge Victor Marrero already seemed shocked by the lack of such admissions: “There is something counterintuitive and incongruous about settling for six hundred million dollars if it truly did nothing wrong.” Amen brother. He could reject it but it would be a rare assertion of judicial authority in a case with such a high financial penalty.

I recommend Cassidy’s article to you below but I suggest not driving or operating heavy equipment after reading the piece.

Source: New Yorker

55 thoughts on “Too Big To Jail? Obama Administration Agrees To Large Penalty In Exchange For Letting Billionaire Escape Insider Training Charge While His Subordinates Plead Guilty”

  1. We have a black prez and a black AG. If you look @ this through a prism of race, one would think they would want to prosecute white collared criminals as much as street criminals. However, this is not about race, this is about class. We will never deal w/ class in this country..NEVER.

    1. I remember being taught in civics class we are a classless society. More and more too many are showing us exactly how classless they are.

  2. Yesterday’s news…

    Lanny Breuer Cashes in After Not Prosecuting Wall Street Execs, Will Receive Approximate Salary of 4 Million Dollars


    “It’s official, and former Department of Justice (DOJ) Criminal Division Chef Lanny Breuer is bragging about it. He’ll return for the third to time the white collar (now expanding its clients internationally) legal defense firm of Covington & Burling, but this time at a whopping salary.

    According to the New York Times: “Mr. Breuer is expected to earn about $4 million in his first year at Covington. In addition to representing clients, he will serve as an ambassador of sorts for the firm as it seeks to grow overseas.”

    As BuzzFlash at Truthout has speculated before, one can argue (and the same holds true for Eric Holder, also a Covington & Burling alumni appointee), Breuer was building his value in the marketplace at the DOJ, while Wall Street executives who nearly destroyed the American economy went unprosecuted. And his future value to his old white collar defense firm was dependent, in large part, on him not angering the people who would be the clients of Covington & Burling when he left the Department of Justice. The result, one can contend: no prosecutions of banks “too big to fail” execs as publicly stated as a policy by both Breuer and Holder.

    This isn’t just a revolving door; one can argue it’s a dereliction of legal responsibility by an employee of the people of the United States. One can proffer that it’s a cash-in career move by a resume climber who was careful not to bite the hands that will write the checks that will feed him on a lavish scale.

    BuzzFlash at Truthout has written more than fifteen commentaries on the failure to prosecute Wall Street execs in recent months. These include: “Consigliere Lanny Breuer, Head of the DOJ Criminal Division, Leaves Without Prosecuting One Made Man on Wall Street” ; and “The Covington & Burling Trio Overseeing the Department of Justice Criminal Division: An Injustice.”

    Breuer isn’t the least bit sheepish about grabbing the brass ring after failing to hold those responsible for nearly sinking the economy criminally accountable. According to the website Main Justice,

    Breuer said that he will also maintain his white collar clients, which he hope to grow following his stint as the Criminal Division’s longest-serving leader in recent history. Moving forward, he expects to have individual and corporate clients in areas such as foreign bribery, money laundering, export control and securities law and whistle blower cases.

    Breuer has spent a combined total of approximately two decades at Covington & Burling.

    According the Corporate Crime Reporter:

    At Covington, Breuer will work with a corporate criminal defense team that includes:

    Robert Amaee, the former Head of Anti-Corruption and Head of Proceeds of Crime at the UK Serious Fraud Office.

    Bruce Baird, former Chief of the Securities and Commodities Fraud Task Force in the U.S. Attorney’s Office for the Southern District of New York.

    Tom Barnett and Deborah Garza, both a former Assistant Attorney General in charge of the Antitrust Division.

    Michael Chertoff, himself a former Assistant Attorney General for the Criminal Division before becoming Secretary for Homeland Security.

    Steve Fagell, former Deputy Chief of Staff and Counselor in the Criminal Division.

    Jim Garland, former Deputy Chief of Staff and Counselor to Attorney General Eric Holder.

    Nancy Kestenbaum and Lynn Neils, both former Chiefs of the General Crimes Unit of the U.S. Attorney’s Office for the Southern District of New York.

    Ethan Posner and Jean Veta, both former Deputy Associate Attorneys General.

    Alan Vinegrad, former U.S. Attorney for the Eastern District of New York.

    And numerous other former federal prosecutors and enforcement officials, including Stephen Anthony, David Bayless, Casey Cooper, Haywood Gilliam, Geoffrey Hobart, and Simone Ross.

    Criticism of Breuer’s exit through the revolving door came quickly from Dennis Kelleher, a former partner at Skadden Arps in Washington, D.C., and currently president of the public interest group Better Markets.

    Kelleher told Corporate Crime Reporter that “nothing is more corrosive to the American people’s trust in government than the revolving door where too many officials turn their so-called public service into multi-million dollar riches unimaginable to most Americans.”

    “This blatant cashing-in is destroying faith in government and government officials,” Kelleher said.

    “Lanny Breuer’s spinning through it is only the latest example: partner at big DC law firm representing corporate clients before the Department, then becomes a senior official at the Department making decisions whether or not to prosecute those same or similar corporate clients, then leaves to go back to private practice representing those same or similar corporate clients with legal issues before, bingo, the Department of Justice,” Kelleher said.

    As we noted in one of our previous BuzzFlash at Truthout commentaries deploring the systemic injustice of people who use government service to raise their cash value in DC, this is quite possibly a crime against the American people for personal enrichment. We are certain Lanny Breuer would deny anything but the purest motives, and that is his right. As he told Main Justice: “So, I love the advocacy system. I’m a zealous advocate, and I look forward to being a zealous advocate for our [Covington & Burling] clients again.”

    But BuzzFlash at Truthout has a different perspective. At a reported $4 million a year, much of Breuer’s salary will have been earned at the expense of not prosecuting justice.

    And a lot of perps are riding around in chauffeured limousines because Lanny Breuer didn’t lift a finger to take away their keys. Now they are his clients again.

    How do you imagine that happened? ”


    Business as usual in the US of A…

  3. SWM, for sure no regrets. and as disappointed as I am in a lot of what he has been doing he has, in spite of “jobs my first priority” and “Compromise not i my vocabulary” Boehner, brought the economy back out of recession, unemployment down, housing rebounding, etc. (somewhat writing to the choir – some of the choir)

  4. I agree, leejcaroll. Most of us are disappointed in some respects but still have no regrets about supporting him over Romney.

  5. “Del Frisco’s, an expensive steakhouse with floor-to-ceiling windows overlooking the Boston harbor, was a festive scene on Tuesday evening. The hedge fund billionaires Steven A. Cohen, Paul Singer and Daniel Loeb were among the titans of finance there dining among the gray velvet banquettes before heading several blocks away to what they hoped would be a victory party for their presidential candidate, Mitt Romney.

    The next morning was a cold, sobering one for these executives.

    Few industries have made such a one-sided bet as Wall Street did in opposing President Obama and supporting his Republican rival. The top five sources of contributions to Mr. Romney, a former top private equity executive, were big banks like Goldman Sachs and JPMorgan Chase, according to the Center for Responsive Politics. Wealthy financiers — led by hedge fund investors — were the biggest group of givers to the main “super PAC” backing Mr. Romney, providing almost $33 million, and gave generously to outside groups in races around the country” NYT

  6. Justice is blind – but she sure can smell money!

    Meanwhile the communist saboteurs win another round. Eventually they will piss off so many decent people with their excess and their consequence free life styles while they crush the rest of us under increasingly unfair labor for decreasing income and their plot will come to fruition!

    The people will rise up and demand a communist economy & these saboteurs will be lined up against the wall and shot. WHAT!? You don’t think that this is their goal? You must be wrong, there is no other logical reason for the way they are behaving than that the WANT this to happen!

  7. SWM< sure hope so. I called White house told them as a foot soldier for Obama how disappointed I am in him and Holder, and this is unacceptable.
    It worked with one of the issues of the ACA, (I forget now which that Prez was ot going to do until he was pressured by the ohone calls and petitions). The WH needs to hear from us, without our voice there is no reason whatsoever for him to care how the citizens feel.

  8. Swarthmore mom,
    I hope Bloomberg is correct. This creep needs some alone time behind bars, in addition to a hefty fine.

  9. I wonder how much he contributed to the Obummer administration? $500,000.00 for a private interview?

  10. “Bloomberg News reporters think that a prosecution of Cohen could still be coming.”

    Let’s hope so. Thanks for the link, Swarthmore mom.

  11. “I recommend Cassidy’s article to you below but I suggest not driving or operating heavy equipment after reading the piece.”

    A wise suggestion.

  12. Damn, Obama must be a Republican after all. I thought they were the party favoring the rich, those who have over 200,000.00 a year in income.
    It is obvious that he is no different than most other politicians, those who lie for votes, and don’t want to offend heavy donors to their party.
    Are their no honorable men left?

  13. Absolutely, utterly, completely disgusting. Mr O, and Mr. H should be impeached. For all those who believed this pied piper in 2008, hows that workin for you now? A new way of doing business in DC? Yep, even worse than the glory days of GWB when the left and the news media routinely excoriated every little detail about the GWB administration. So where is the outrage from the left? I’m listening? Still listening?…

  14. Dear President Obama and AG Holder,

    Screw you.


    Justitia a.k.a Lady Justice

  15. Obama and Holder affirming equality under the law for billionaires. No wonder banksters felt that no matter what they did there would be no penalty. Unfortunately for Mr. Cohen’s associates they just were not rich enough.

  16. Holy crap! Now even banksters and not just big banks are too big to Jail!??? Why not jail and the fine? If his workers face criminal charges why shouldn’t the boss who purportedly directed the whole thing?!

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