Would you like the top bunk, Secretary Geithner?
Without a doubt, the best headline I've seen in months. Even better, it's not a joke.
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Source: All Headline News
Washington, D.C., United States (AHN) - The Senate heard testimony Tuesday on the idea of throwing Wall Street bankers in jail when they make reckless decisions that jeopardize their customers’ investments.
The hearing started only hours before senators starting voting on amendments to a financial reform bill that would revamp the way Wall Street does business.
Until now, the worst corporate executives could expect for bad business moves was steep fines.
As the nation recovers from the worst economic collapse since the Great Depression of the 1930s, polls show most Americans want more severe penalties than a small slice of the corporate profits.
“You should go to jail when you do something like what Goldman Sachs did,” said Sen. Ted Kaufman (D-Del.), a member of the Senate Judiciary Committee.
Kaufman said that although few people understood the financial jargon used by the executives, nearly everyone agreed they made terrible decisions.
“Every person I’ve run into since that hearing has said, ‘That was wrong,’” Kaufman said.
They also complained that the Wall Street wizards can get away scandalous behavior for which anyone else would be punished.
“I think there’s a crisis in terms of people thinking there are two different rules,” Kaufman said.
Witnesses at the Senate hearing said fines are a small price to pay for corporate executives who get bonuses worth millions of dollars a year.
“They’re a drop in the bucket compared to the profits these firms are making,” said Barbara Roper, director of investor protection for the Consumer Federation of America, a nonprofit group.
The Senate Judiciary Committee called the hearing to hear expert opinions as it considers new legislation that would crack down on Wall Street corporate executives.
In addition to imposing jail time on reckless executives, the Wall Street Accountability Act would regulate investments that are bets on the performance of other financial products.
It also would require financial institutions to maintain cash reserves to pay off their customers when their investments fail. Corporate executives would be limited in the bonuses they could receive.
Senate Judiciary Committee Chairman Arlen Specter (D-Pa.) referred to the actions of Wall Street bankers who gamble with investors money as “aiding and abetting” a crime.
Aiding and abetting refers to laws that impose criminal penalties on anyone who assists in a crime.
Tougher civil restrictions are included in proposed Senate legislation that would drastically reduce the discretion of investment firms on how they handle other people’s money.
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