The Global Financial Crisis and White-Collar Crime

No senior Wall Street executives were imprisoned for actions that contributed to the global financial crisis. The few criminal prosecutions for management were reserved for executives at small and regional financial firms. This stands in stark contrast to the approximately 1,000 executives jailed after the 1989 savings and loan crisis. It also runs counter to public support for criminal accountability post-crisis as well as the general trend toward criminal social control in the United States. Likewise, few firms faced criminal prosecution. Instead, the primary punishment resulted from civil penalties leveled against individuals and firms, with most of the largest banks paying billions in fines to regulatory agencies and in restitution to victims. Now that the five- or ten-year statute of limitations for the criminal fraud statutes most relevant to questionable pre-crisis behavior has passed, and the political salience and public outcry over financial misdeeds has subsided, the window of opportunity for criminal accountability is closed. Still, the lack of accountability raises important questions for financial regulation, the state of prosecution for white-collar crime, the nature of financial industry influence over politics, and the broader health of US democracy. What role did Wall Street, and the broader financial services industry, play in bringing about the crisis? What behaviors, if any, crossed the line from legitimate business activity intro criminal behavior? Is that distinction easily drawn? And if actors did behave criminally, why did state and/or federal prosecutors not pursue criminal charges more aggressively? What can be learned from countries that used criminal prosecutions more successfully? Even if criminal behavior occurred, is strong prosecution the appropriate remedy to deter future crime and prevent another financial crisis? There is substantial agreement that financial industry behavior contributed to, and amplified the severity of, the crisis. There is, however, much less agreement about whether white-collar crime occurred; if it did, why it went unpunished; and whether criminal punishment is the proper response on moral or practical grounds. The historical and political context for how white-collar crime was (re)framed, how this framing contributed to the deregulation of the financial industry, and the rise of its political power explain how the Wall Street’s behavior was understood, rationalized, and left largely unpunished.

Examining Federal Criminal Sentencing of White-Collar and Common Property Offenders: The Case of Embezzlement and Larceny

Criminal Justice Policy Review ◽

10.1177/0887403417709313 ◽

2017 ◽

Vol 30 (5) ◽

pp. 681-707 ◽

Cited By ~ 1

Author(s):

Alexander Testa

Keyword(s):

Common Property ◽

Global Financial Crisis ◽

White Collar Crime ◽

Property Crime ◽

White Collar ◽

The United States ◽

Criminal Proceedings ◽

Using Data ◽

Matching Techniques

This study addresses the question of whether those charged with embezzlement—an offense characterized as a white-collar crime—are punished leniently, severely, or approximately the same compared with similarly situated larceny offenders—an offense characterized as a non–white-collar property crime—in federal criminal proceedings. To assess this question, the current study uses propensity score matching techniques to create a comparable sample of embezzlement and larceny offenders. Using data from the United States Sentencing Commission on individuals sentenced from years 2005 to 2010, the current study finds embezzlement offenders are more likely to be sentenced to incarceration relative to larceny offenders. In addition, the findings suggest that embezzlement offenders did not have a significantly higher likelihood of receiving a sentence of incarceration in the years following the onset of the Global Financial Crisis.

Increasing Transparency in Capital Markets after the Global Financial Crisis: The Case of Turkey

International Conference on Eurasian Economies 2015 ◽

10.36880/c06.01267 ◽

2015 ◽

Author(s):

Cüneyd Ebrar Levent

Keyword(s):

Financial Crisis ◽

Financial Markets ◽

Capital Markets ◽

Global Financial Crisis ◽

The United States ◽

Wall Street ◽

Small Investors ◽

Transparency And Disclosure

The need for financial transparency is way beyond reducing fluctuations on financial markets, the protection of small investors or fighting against money laundering. Asian crisis in 1997, Dot-com bubble in 2000, company crises such as Enron and the global financial crisis in 2008 have shown that a crisis caused by the lack of transparency in companies might not only affect the company and its stakeholders in a negative way but also the country and the region the company is in. After the financial crisis of 2008 many countries made various arrangements in capital accounts about increasing transparency and accountability which was seen as one of the reason of the crisis in addition the short and long term precautions. Dodd–Frank Wall Street Reform and Consumer Protection Act which came into force in the United States in July 2010 is one of the most significant arrangements. In this study, practices of increasing transparency in capital markets after global financial crisis have been discussed. In this context, in light of the new regulations and the Corporate Governance Principles, transparency and disclosure practices in Turkey have been examined. The results of these practices have been analyzed in the short term and its possible effects on capital markets, companies and shareholders have been discussed in the long term. Increasing transparency has been expected to help financial markets process more effectively and to provide benefits to all stakeholders.

A Global Perspective on Securitized Debt

10.1093/oso/9780198813392.003.0022 ◽

2018 ◽

Author(s):

Steven L Schwarcz

Keyword(s):

United States ◽

Financial Crisis ◽

Capital Market ◽

Global Financial Crisis ◽

The United States ◽

Global Perspective ◽

Capital Markets Union ◽

Asset Backed Securities ◽

The Eu

Securitisation represents a significant worldwide source of capital market financing. European investors commonly invest in asset-backed securities issued in U.S. securitisation transactions, and vice versa One of the key goals of the European Commission's proposed Capital Markets Union (CMU) is to further facilitate securitisation as a source of capital market financing as a viable alternative to bank-based finance for companies operating in the EU. To that end, this chapter explains securitisation and attempts to put its rise, its decline after the global financial crisis, and its recent CMU-inspired revival into a global perspective. It examines not only securitisation's relationship to the financial crisis but also post-crisis comparative regulatory approaches in the EU and the United States.

The aestheticization of restraint: The popular appeal of de-cluttering after the global financial crisis

Journal of Consumer Culture ◽

10.1177/1469540519872071 ◽

2019 ◽

Vol 19 (4) ◽

pp. 513-531 ◽

Cited By ~ 1

Author(s):

Susie Khamis

Keyword(s):

Financial Crisis ◽

Global Financial Crisis ◽

Discussion Groups ◽

Occupy Wall Street ◽

Wall Street ◽

Occupy Movement ◽

Video Tutorials ◽

Popular Appeal ◽

Liberal Economy ◽

The concept of consumer restraint has had a popular makeover. This is seen in the worldwide popularity of books, video tutorials and online discussion groups devoted to de-cluttering, and specifically the stunning success of professional organizer Marie Kondo and her best-selling book, The Life-Changing Magic of Tidying. De-cluttering sits on a broad continuum of alternative consumption that champions the benefits of consumer restraint, on multiple fronts: economic, environmental, psychological, and so on. Through Kondo, this is framed in positive, uplifting ways. This is distinct from the more critical, nuanced, or anti-consumerist rhetoric associated with more subversive advocates of alternative consumption, such as voluntary simplifiers or Occupy Wall Street. That said, just as the Occupy movement channeled growing frustration with how the reigning tenets of capitalist culture had shackled and misled the “99%,” de-cluttering finds cultural traction in the midst and wake of the Global Financial Crisis. Unlike Occupy though, Kondo’s appeal rests less on the logic and language of political economy than the more emotive vernacular of pop psychology. In this way, de-cluttering positions restraint as reflective of a highly developed and sophisticated sensibility, whereby individuals “own” their consumption choices and in turn craft carefully curated spaces. Therein lies the aestheticization of restraint: freed of any negative connotations (dour, miserly or miserable), the de-cluttered subject is autonomous, self-aware, and chic. Crucially, it also pivots on the slippery assumptions of the (new) neo liberal economy, which requires individuals to be agile, creative, and empowered.

“A Change in the Balance of Power”

10.1093/oso/9780197527917.003.0008 ◽

2021 ◽

pp. 159-182

Author(s):

Rush Doshi

Keyword(s):

United States ◽

Financial Crisis ◽

Global Financial Crisis ◽

Balance Of Power ◽

The United States ◽

Grand Strategy ◽

Chinese Leader ◽

Regional Order ◽

Balance Of Forces ◽

Chapter 7 explores the dawn of China’s grand strategy to build regional order as well as the ends, ways, and means of this strategy. Using Party texts, it explores how the shock of the Global Financial Crisis led China to see the United States as weakening and emboldened it to take a more assertive course. It begins with a thorough review of China’s discourse on “multipolarity” and the “international balance of forces,” concepts China uses as euphemisms for US power and which it ties to its strategic guidelines. It then shows that the Party sought to lay the foundations for order—coercion, inducements, and legitimacy—under the auspices of the revised guidance “actively accomplish something” issued by Chinese leader Hu Jintao in 2009. This strategy, like blunting before it, was implemented across multiple instruments of statecraft—military, political, and economic.

The Arab world amidst the global financial crisis of 2008–2009

Contemporary Arab Affairs ◽

10.1080/17550910903541835 ◽

2010 ◽

Vol 3 (1) ◽

pp. 38-52

Author(s):

Shalendra D. Sharma

Keyword(s):

Financial Crisis ◽

Financial Markets ◽

Global Financial Crisis ◽

Arab World ◽

The United States ◽

Arab Countries ◽

Financial Contagion ◽

Poor Countries ◽

Resource Poor ◽

When the problems in the United States housing sector mushroomed into a global financial crisis by September 2008, it was assumed that Arab countries would remain immune: the oil-rich Gulf Cooperation Council (GCC) countries because of their massive financial reserves, and the resource-poor countries because of their limited linkages to the global economic system – in particular, the global financial markets. However, this assumption has proven to be false. The US subprime mortgage collapse not only pushed the advanced economies into recession, but also it shattered global economic confidence, resulting in a massive financial contagion around the world. What explains the Arab World's vulnerability to the crisis? How has the crisis impacted both the resource rich and the resource poor? How have Arab countries responded to the crisis, and what must they do to insulate their economies better from the vagaries of global financial markets? This paper addresses these questions.

15 Litigation and Enforcement involving Private Funds after the Global Financial Crisis

10.1093/law/9780198807247.003.0015 ◽

2018 ◽

Cited By ~ 1

Author(s):

Spangler Timothy

Keyword(s):

Financial Crisis ◽

Hedge Funds ◽

Global Financial Crisis ◽

Private Investment ◽

The United States ◽

Regulatory Regime ◽

Investment Funds ◽

The Subject ◽

The Uk

This chapter focuses on the increase in the amount of litigation and enforcement actions against private investment funds in the United States, the UK, and across the globe as a result of the global financial crisis. As more disputes arose during the course of the global financial crisis, the legal and regulatory regime impacting private investment funds has been the subject of closer scrutiny than has been seen in previous decades. The chapter first considers the Securities and Exchange Commission’s (SEC) enforcement actions against hedge funds as well as U.S. civil litigation prior to the financial crisis before discussing Dodd-Frank and its effect on enforcement. It then examines the SEC’s enforcement actions regarding broker-dealer registration, along with some of its key enforcement actions after Dodd-Frank. It also analyses the Financial Conduct Authority’s enforcement priorities after the global financial crisis and key litigation in the UK involving private investment funds.

Fiscal and Monetary Policies in Reaction to the Financial Tsunami by the Taiwanese Government

Review of Pacific Basin Financial Markets and Policies ◽

10.1142/s0219091511002172 ◽

2011 ◽

Vol 14 (01) ◽

pp. 153-169 ◽

Cited By ~ 4

Author(s):

Hsiao-Yin Chen ◽

Cheng-Few Lee ◽

Tzu Tai ◽

Kehluh Wang

Keyword(s):

Financial Crisis ◽

Financial Market ◽

Global Financial Crisis ◽

The United States ◽

Insurance Companies ◽

Monetary Policies ◽

Policy Measures ◽

The Impact ◽

Taiwanese Government

The main purpose of this paper is to investigate the impact of the 2007 financial tsunami on the Taiwanese financial market. We find that, although significant for banks, security firms, and insurance companies, the effect was relatively lower if compared with that in Europe and the United States. In addition, we present fiscal and monetary policies issued by the Taiwanese government in reaction to the global financial crisis. These policy measures focused on stabilizing the financial market, reducing the level of unemployment, and creating more lending opportunities in support of Taiwanese companies. We also discuss the policy measures of the US government and other Asian countries in relation to the global financial crisis. Finally, we provide some suggestions to improve financial supervision and enhance financial reforms in Taiwan.