Before Sir Mervyn King made his comments in his recent Mansion House speech, on March 6th this year the US Attorney General, Eric Holder, said at a Senate Judiciary Committee:
"The size of the largest financial institutions has made it difficult for the U.S. Justice Department to bring criminal charges when there’s wrongdoing.
Criminal charges against a bank - something that could threaten its existence - may also endanger the national or global economies in the case of the largest ones, because of their size and interconnectedness. That has made it difficult for us to prosecute.
That is a function of the fact that some of these institutions have become too large. It has an inhibiting impact on our ability to bring resolutions that I think would be more appropriate.”
When, over 4 years ago, the author of this blog wrote in his submission to the House of Commons Treasury Committee that the financial industry became a criminal enterprise in legal sense of this phrase, many considered it as an outlandish and eccentric statement, rather than the outcome of a professional analysis on the merits. It appears that the authorities - and then mainstream media - albeit slowly, start catching up with the reality. Why so late? It is very trivial indeed and has been more than obvious all along. However a more important question is when we start seeing prosecutions. How many years is it going to take? There is no point of even considering the current proposal of prosecuting for "reckless management" in the future until and unless the crimes of the past are not resolved. Basically first things first: the government should set the priorities right.