Here is an interesting response from Senator Chuck

Here is an interesting response from Senator Chuck Grassley concerning Wall Street crimes. I correspond with the Senator regularly. Pressure from the voters is the only way to affect change (hint, hint).

CHARLES E. GRASSLEY
WASHINGTON, DC 20510-1501
721 FEDERAL BUILDING

Dear Mr. ***********

Thank you for taking the time to contact me about high frequency trading. As your Senator, it is important that I hear from you and I welcome the opportunity to respond.

I appreciate hearing of your concerns about potential corruption at the Securities and Exchange Commission (SEC) and within the banking and investment industries. Specifically, you mentioned high frequency trading and the actions leading up to the subprime mortgage crash as point of particular concern.

Recently, high frequency trading has received additional scrutiny from Congress and the Justice Department. In June and July, the Senate Committee on Banking, Housing, and Urban Affairs held multiple hearings on the practice of high frequency trading and its effect on financial markets. While I am not a member of this committee, it is important for me to know of your thoughts should any legislation make it to the Senate floor on this topic.

Lastly, in your letter, you expressed frustration that there have been no criminal prosecutions for crimes committed by those in the financial industry. Like you, the lack of criminal prosecutions for crimes committed by certain individuals within the financial industry disturbs me. During my tenure in the Senate, I have conducted vigorous oversight over the financial industry. Most recently, on January 29, I and Senator Sherrod Brown sent a letter today to U.S. Attorney General Eric Holder questioning whether the “too big to fail” status of certain Wall Street megabanks undermines the ability of the federal government to prosecute wrongdoing and impose appropriate penalties. My letter also requested that the Justice Department disclose the identities of parties with whom prosecutors consult about the appropriate level of penalties for financial institutions.

In the past several years many of the nation’s largest banks have received a taxpayer funded guarantee simply by virtue of their size, making it harder for regional and community banks to compete. It is uncertain if and to what degree these megabanks may also enjoy some impunity when they violate the law by laundering money or illegally foreclosing on homeowners. With the lack of criminal prosecutions, the public deserves an explanation of how the Justice Department arrives at their decisions to proceed with criminal proceedings against alleged instances of criminal wrongdoing associated with large financial institutions.

As Ranking Member of the Judiciary Committee, I have been critical of the Justice Department’s decisions against holding people criminally accountable in financial cases in the past and will continue to investigate this matter. Most recently, I called the Justice Department’s decision to forego any criminal prosecution of HSBC officials involved in that money laundering scandal inexcusable. I also questioned the Justice Department about the number of mortgage fraud cases brought forward, revealing a failure to bring significant criminal cases against any of the major banks or financial institutions that have faced civil actions for various frauds. I am the author of the Fraud Enforcement Recovery Act, signed into law in 2009, that was designed to ramp up the government’s response to the crisis and ensure that prosecutors and investigators had the tools needed to combat fraud.



Thank you again for contacting me. It is an honor to serve Iowans like you. Please keep in touch.

Sincerely,
Chuck
COMMITTEE ASSIGNMENTS
RANKING MEMBER,
JUDICIARY

AGRICULTURE
BUDGET
FINANCE CO-CHAIRMAN,
INTERNATIONAL NARCOTICS
CONTROL CAUCUS
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