Senator Elizabeth Warren wants regulators to take more banks
accused of financial misconduct to trial instead of settling with
them before trial. But she is not the only one in Washington
looking for ways to send a message to financial institutions that
they had better not violate the law. The Justice Department (DOJ)
is already implementing a new approach to dealing with banks it is
prosecuting. Prosecutors have been pushing for guilty pleas, in
addition to fines and reforms, in settling financial fraud cases.
See http://dealbook.nytimes.com/2013/02/18/prosecutors-build-a-bett...
So far, the DOJ has extracted guilty pleas only from remote
subsidiaries of big foreign banks. In recent settlements with UBS
and Royal Bank of Scotland (RBS), which were accused of
manipulating LIBOR interest rates, the banks' Japanese
subsidiaries pleaded guilty to felony wire fraud. This is a new
strategy for the DOJ, since it was previously feared that requiring
guilty pleas would
