Prosecutors are empowered to defend the rule of law. Sometimes that takes on the form of a civil prosecution. In such cases, the government is out to impose a penalty or fine and often restitution for the wronged party. In more egregious violations of the law, the prosecutor can resort to the criminal code and seek to not only take a wrongdoer’s money (a fine or penalty) but also their liberty (the ultimate sanction).
Of course if you are an alleged wrongdoer, being investigated by the government, you sure hope they are seeking civil charges. It’s only money as they say. How much would Raj Rajaratnam have paid to stay out jail for eleven years? $100 million, $500 million? What about a billion? You bet. Ask him while he finishes doing dishes in the prison cafeteria, folding others’ laundry or sleeping in a government-issued cot, in a communal dormitory-style room, a far cry from his Sutton Place penthouse he enjoyed until last week. Eleven years in prison while he misses his children growing up and the last years of his life are spent in shame – That’s quite a sanction.
So Kerry Killinger, Stephen Rotella, and David Schneider must have been thrilled to learn they were only being investigated for civil violations. “Party at my house!” No jail – pheww. The last few years waiting to see must have been tense, but I will bet the champagne (the good stuff) will be flowing New Year’s eve at the Killinger house.
Not only did he and his running buddies at WAMU avoid prosecution but they avoided any sort of fine or penalty. You’re the masterminds of the largest failure of a savings & loan institution in history (which cost the taxpayers plenty) and you think – holy Columbus – this is going to cost me every penny I have or worse yet, a nice chunk of time in jail. Wrong.
Mr. Rotella, this way to the traffic court, sir. All you need to pay is a parking ticket-sized fine (relatively speaking) and you are on your way to Disney World. Keep the $77 million as a parting gift from us – the taxpayers and U.S. Government.
Wow. What just happened? To avoid the next debacle, prosecutors must put the fear of prison and personal bankruptcy in the mix. The cases against former WAMU executives only signal full steam ahead for someone now at a bank or brokerage firm plotting a high risk, high reward, highly leveraged and barely legal scheme to make a quick fortune. That ain’t right.