In Iceland [ht: ra], by the end of 2015, 26 high-level bankers had been sentenced to a total of 74 years in prison.
It’s a move that “would make many capitalists’ head explode if it ever happened here.”
In the United States, all the major Wall Street financial firms nicknamed Too Big To Fail banks—Bank of America, JPMorganChase, Citigroup, Wells Fargo, and Goldman Sachs—have paid out settlements for illegal conduct in the mortgage-security markets that caused the 2007-08 crash. However, no individual executives have gone to jail or even faced prosecution for that conduct.
In fact, according to report from researchers at Syracuse University, during 2015, federal prosecution for white-collar crime fell to a 20-year low.
The available records show an overall decline that began during the Clinton Administration, with a steady downward trend — except for a three-year jump early in the Obama years — continuing into the current fiscal year.
During the first nine months of FY 2015, the government brought 5,173 white collar crime prosecutions. If the monthly number of these kinds of cases continues at the same pace until the end of the current fiscal year on September 30, the total will be only 6,897 such matters — down by more than one third (36.8%) from levels seen two decades ago — despite the rise in population and economic activity in the nation during this period.
The projected FY 2015 total is 12.3 percent less than the previous year, and 29.1 percent down from five years ago.
The argument in the United States has been that prosecuting and jailing banking executives would have disrupted the financial sector and the economy as a whole.
While the recovery in Iceland from the financial crash has been anything but smooth, it’s still the case that unemployment has fallen to 4 percent and wages have been rising at an annual rate of 6.2 percent.