I read the other day that the six largest U.S. bank holding companies have paid more than $150 billion in fines since 2009. Yet, at the same time, not a single senior executive or director of these banks has been identified as culpable for their banks’ egregious legal and regulatory violations, much less pursued by the Justice Department or the financial regulatory agencies.
Meanwhile, scores of community bank officers have been and are being sued by their regulators or pursued by the DOJ or local prosecutors for violations that are often much less serious than those perpetrated by executives at the nation’s largest financial firms.
I mean, certainly some human being somewhere within these megabanks had to have violated financial laws or regulations, or why would their institutions write billions of dollars in checks to cover their wrongdoing? In cases such as HSBC, management even admitted that it knowingly violated laws and regulations, but did so anyway because the profit was so good.
This is what is so insidious about too-big-to-fail institutions: the managements and boards begin to believe they are above the law. Unfortunately, recent history has proved them right—even to the point where Attorney General Holder, in open testimony before the U.S. Senate, hedged when asked if executives at certain too-big-to-fail banks were immune from prosecution.
In sworn testimony before the Senate Judiciary Committee, Holder said law-enforcement officials have hesitated to pursue financial wrongdoing at the largest banks because of the potential economic impact. Seriously? Is the law not the law? Are we not a country of laws that in our American tradition are to be equally applied to one and all no matter a person’s circumstance or station?
This Orwellian reality of money and power taking precedent over equal justice under the law gives us a modern take on the old Animal Farm commandment: some banks are just more equal than others.
While Main Street community bankers and their boards are personally prosecuted and pursued by government agencies for restitution, Wall Street and global bankers can rest easy and just write another check. After all, the checks are funded from the ill-gotten gains of their violations, and there is plenty more where that came from.
Finer Points 
As a former bank examiner, I agree 100%. The FDIC is usually the regulator that pursues such actions but does not have the expertise nor the resources to go up against the highly paid executives of large financial institutions and focuses its sights on Main Street bankers. Sometimes the Main Street bankers “transgression” is minimal and may have not even caused any loss to the financial institution (open banks). Also, while the FDIC is the pursuer of such actions, the OCC and Federal Reserve are generally the regulators for the larger institutions, and cooperation and agreement is required between the agencies in order to take action. The agencies do not play well in these situations and turf wars are not uncommon. But then isn’t this what America is all about. The wealthy and upper class get richer and are protected while the middle and lower class get shafted.