[zekevermillion]

We don't need a "crackdown". The problem with our approach to financial crimes is that it is based almost entirely on crackdowns -- splashy press releases that are supposed to deter all the thousands of other financial crimes that we lack resources to prosecute. Sometimes this leads to injustice, e.g., see the documentary film Abacus: Small Enough to Jail. The only bank to be prosecuted criminally for shenanigans in the subprime era.

What we do need is vastly more resources for financial regulators, as well as courts. Yes the laws and regs could also be improved, but that is a harder problem. The easy problem is that the people doing good work to combat financial crimes only have the staffing and money to go after a small, small fraction of likely targets. And the courts do not have what they need to handle a high volume of increasingly complex, technical subject-matter.

[hannasanarion]

Financial regulators aren't the only ones relevant here. There work is useless if there's nobody available to investigate it and bring charges.

That used to be the FBI's main job, but since 2001 they've been mostly ignoring white collar crimes to focus on counterterrorism.

[liftbigweights]

> Abacus: Small Enough to Jail.

My goodness that documentary had me so infuriated. If people haven't seen it, I highly recommend it.

> The only bank to be prosecuted criminally for shenanigans in the subprime era.

That's the amazing part. Out of all the multinational "too big to fail" banks in NYC, they went after a small community bank. Just on optics it looks terrible, but the bank they went after actually had very low numbers of defaults and foreclosures.

That was as clear a case of bullying as I've seen. They went after the smallest bank they could find to intimidate them and force them to settle so that they can tell the press the banks were punished for the financial crisis. Which would have been a farce had they succeeded.

[anonymous5133]

FYI, for others reading. You can watch the abacus documentary in the link below. I highly recommend it as well. Well worth the 90 mins for sure.

https://www.pbs.org/video/abacus-small-enough-to-jail-suqmxe...

[thirdsun]

> FYI, for others reading. You can watch the abacus documentary in the link below.

*unless you live outside the US.

[Eridrus]

This is probably true for the IRS. I'm less sure this is true for th SEC. From the admittedly limited amount I have read about insider trading cases, it seems like the courts have interpreted the law extremely narrowly, and this has basically legalised many common forms of insider trading where there is no explicit quid pro quo. Similarly to how we have interpreted corruption.

[atr_gz]

The story about Abacus was interesting. I didn't realize they were the only actual bank to be prosecuted. That said, a handful of employees at other small banks around the country were prosecuted - I personally know a low-level mortgage broker who went to prison for fraud related to the 2008 crisis. They were falsifying mortgage applications for unqualified customers.

The enforcement still wasn't enough in my opinion, but (and I'm struggling to find a source backing me up) I believe there were several hundred of these cases. None, however, from the big banks that arguably should take more of the blame.

[paulie_a]

Post 2008 the real estate industry was rife with fraud. I had a boss that got kickbacks from contractors fixing rigged bids on foreclures to the tune of 500-600k. He never got caught. It was blatantly illegal and involved federal agencies.

[FireBeyond]

Abacus as a bank wasn't guilty of this.

They had some brokers that they fired, before any criminal action had been filed, when a senior manager noted indiscrepancies in the closing process (like writing multiple small checks for down payments and closing costs).