Excerpts below from The Divide: American Injustice in the Age of the Wealth Gap by Matt Taibbi, published by Spiegel & Grau, 2014:
At more or less exactly the same time that Tory Marone was being offered his deal to spend forty days at Rikers for half a joint that was all-the-way hidden in his pocket, the U.S. Department of Justice, in the person of still-assistant attorney general Lanny Breuer - (Eric) Holder's right-hand man, the head of the department's Criminal Division, and ostensibly still the top-crime-fighting official in the country - was making a historic announcement. ...
... The bank (HSBC) admitted to laundering billions of dollars for drug cartels in Mexico and Colombia, washing money for terrorist connected organizations in the Middle East, allowing rogue states under formal sanctions by the U.S. government to move money freely by the tens of billions through its American subsidiary, letting Russian mobsters wash money on a grand scale using a see-no-evil traveler's checks program, and helping tax cheats and other crooks from Miami to Los Angeles to Peru hide hundreds of millions of dollars in nearly anonymous "bearer share" accounts.
Essentially, HSBC, as perhaps the biggest and most accessible "reputable" bank in Asia, Africa, Central America, and the Middle East, had enthusiastically opened its vaults, including its American vaults, for most every kind of antisocial and/or criminal organization on the planet, allowing mass murderers, human traffickers, and embezzlers unfettered access to the safety and comfort of U.S. dollars. ...
... So what was the penalty for laundering up to $7 billion for Central American drug cartels? For allowing Russian "used car dealers" to deposit $500,000 a day for years in U.S. banks using traveler's checks? For supplying the Al Rajhi Bank of Saudi Arabia, whose founder was revealed after 9/11 to have been one of the original twenty benefactors to al-Qaeda, with more than 1 billion U.S. dollars - a bank HSBC's own compliance officers recommended abandoning after it was caught supplying Chechen extremists with traveler's checks in 2005, but which it continued to do business with through 2010? For allowing 25,000 U.S. banking transactions totaling $19.4 billion with the sanctioned state of Iran over a six-year period, and allowing similar transactions from prohibited locales like North Korea and the Sudan? ...
... Nothing. In terms of jail time, anyway, the penalty was nothing. No individual would be charged with anything or have to pay a dollar in fines. No person in any of HSBC's banks anywhere in the world had to have so much as a ticket on his record.
The only penalty was a settlement. It was a big fine: $1.9 billion, at the time the biggest such fine in history - which sounds impressive until you realize the sum equaled about five weeks of revenue for a bank that earned somewhere north of $22 billion a year. Oh, and HSBC had to partially - not fully but partially - defer some of its bonus payments to top executives.
And it had to apologize, which it did. "We are profoundly sorry," said CEO Stuart Gulliver.
The cops had let HSBC walk out of the park. ...
... "I don't think the banks got off easy," he (Breuer) said, adding, "We've held them very much accountable. I'm not sure you can find a more robust resolution."
But Breuer was standing less than a mile from a homeless drifter who at that very minute was getting a "more robust solution" for having half a joint in his pocket.
For aiding and abetting drug cartels suspected in more than twenty thousand murders, groups famous for creating the world's most gruesome torture videos - the Sinaloa Cartel in particular, with its style of high-volume reprisal killings and public chainsawings and disembowelings, makes al-Qaeda look like the Peace Corps - HSBC got a walk. Tory Marone, for smoking their product and passing out on a park bench, got sent to jail.
This meant the very lowest kind of offender in the illegal drug business, the retail consumer at the very bottom of the drug food chain, had received a far stiffer sentence than officials at HSBC who were hundreds of millions of dollars deep into the illegal drug business, not for any excusable reason but just to seek profits to pile on top of profits. ...
. . . . . . . .
... But for all the criticism, and despite Breuer's odd performance at the HSBC presser, the actual policy that had guided the decision was still semidisguised. It would not be formally unveiled until a week later, at the next outrageous settlement, this one involving the Swiss banking giant UBS for its part in a worldwide price-fixing scandal known as the LIBOR affair. ...
... Involving thousands of transactions, hundreds of individuals, and somewhere between nine and sixteen of the world's biggest banks, the LIBOR affair at the heart of the UBS settlement was, numerically speaking, probably the biggest financial scandal ever. At the time, it was both the biggest antitrust case and the biggest price-fixing case ever to surface (some serious competitors have since reared their heads). By working together to rig global interest rates through their manipulation of the London Interbank Offered Rate - a projection of the rate at which banks charge one another to borrow and lend money - banks like UBS, Barclays, the Royal Bank of Scotland, and perhaps as many as six other companies (according to British regulators) impacted the price of hundreds of trillions of dollars of financial products, everything from mortgages to credit cards to municipal bonds to swaps and even currencies. ...
... For this incredible serious crime, which had consequences for nearly every person in the world who has money or buys or sells anything, ... the UBS parent company completely escaped prosecution. Its Japanese subsidiary was allowed to plead to a single felony count, while two former UBS employees were charged with crimes. But the parent company was affirmatively nonprosecuted and let off with a $1.5 billion fine. The bank didn't have to admit to anything in the deal, except the need to pay the government money to go away. ...
... The crowd of reporters was getting restless by now - Breuer was losing control. At this point, (Eric) Holder tagged Breuer out of the ring, smoothed his tie, and stepped to the lectern.
Thirteen years after authoring his Collateral Consequences memo, Holder was finally going to explain it, out in the open, to the entire world.
"I'm not talking about just this case, but in others that we have resolved, the impact on the stability of the financial markets around the world is something that we take into consideration," Holder began.
The room was suddenly very quiet.
"We reach out to experts outside of the Justice Department to talk about what are the consequences of actions that we might take," Holder explained, "[and] what would be the impact of those actions if we wanted to make a particular prosecutive [sic] decision or determination with regard to a particular institution."
The crowd of reporters listened in stunned silence to this speech.
"So that," Holder concluded, "factors into the kinds of decisions that we make."
The attorney general of the United States had just admitted in front of a room full of reporters, that he asks Wall Street for advice before he prosecutes Wall Street. ...
... Collateral Consequences was out of the bag. After years and years of mysterious nonprosecutions and expertly negotiated cost-of-doing business fines, we finally had the policy it all led to.
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