#M24, A Whole Summer of Action to Hold Wall Street Accountable
Month One: Read all 50 states Attorney General reports regarding corporate fraud in the insurance industry, public records of past insurance fraud committed by insurance companies and review all insurance department complaints from across the nation.
Month Two: Meet with the Insurance Department Fraud Divisions of all 50 states. Specifically obtain the names of all the Liberty Mutual Officers involved in fraud alleged by each individual state, obtain lawyers and notaries names whose behavior, as cited in the Insurance Department reports or otherwise known to the investigators, represent clear and unquestionable criminal violations. Add to this list other individuals who have similarly demonstrated or testified to behavior unquestionably constituting criminal acts, as indicated by the public records of these insurance department cases reviewed in month one.
Month Three: Indict all of the individuals on the list compiled on Month two.
Month Four: Indict banks and financial institutions who conspired with Liberty Mutual on criminal charges where criminal behavior by employees (as demonstrated by month three indictments) appears to be endemic. The Justice Department guidelines for prosecuting firms include: (1) the pervasiveness of such activity, (2) the compliance procedures in place, (3) attempts by the corporation to end bad behavior, and (4) cooperation with federal investigators. In 2008, the Justice Department adopted a policy of accepting “deferred prosecutions,” involving agreements to change corporate behavior without damaging innocent third parties through prosecution.
Corporations receive the benefits of “legal persons,” as demonstrated by Citizens United. But they must also bear the responsibilities of these privileges. A reading of these insurance department reports, and other public records, suggests several banks along with Liberty Mutual should clearly be prosecuted.
Month 5: Discuss plea bargains with indicted lower-level officials in return for cooperating in investigations of higher-level officials.
Month 6: Consider plea bargains with indicted Insurance Companies, which require the removal of all remaining officers and directors who were serving when egregious criminal activity occurred, as well as senior officials who were in a position to exercise appropriate supervisory responsibility but chose to look the other way.
Month 7: Indict any senior Liberty Mutual officials implicated by new cooperative testimony resulting from activities on day five. Adopt and announce a policy that future criminal violations will be prosecuted in a similar fashion.
What is particularly disturbing is that a look at the evidence already in the public domain (much less what investigators already know) shows that none of the actions discussed above are entirely absurd. The purpose of prosecution not simply punishment. It acts to deter further illegal activity and to restore public confidence in our system of governance. The nation desperately needs both of these benefits today.
Moreover, these ongoing, almost certainly criminal activities are ultimately dangerous threats to our economy, the success of capitalism, and our democracy. In his column on MF Global, Joe Nocera noted that “customers need to be able to trust” the laws protecting their money. “Otherwise, the markets can’t function.”
Today, as in the era of FDR, we must send a message to the financial community that illegal behavior will not be tolerated. By prosecuting blatant felonies now, we will deter future misbehavior and begin the process of recreating a fair society where equal justice prevails.