Senator Elizabeth Warren says too many companies are getting away with bad behavior.
“Corporate criminals routinely escape meaningful prosecution for their misconduct,” Warren concluded.
Warren cited examples of companies engaging in fraud, covering up deadly safety problems and contributing to the financial ruin of millions of Americans.
She said the companies on her hit list walked away with little more than a wrist slap from the government, and that people responsible for wrongdoing were rarely ever punished. Warren listed 20; here are 10 as detailed in her report:
Warren’s top corporate scandals of 2015
1) SP’s credit ratings: Accused of defrauding investors by misrepresenting the credit risks of mortage-backed securities, SP and the Department of Justice settled on a $1.4 billion fine — one-sixth what the DOJ and 19 states initially sought.
2) “The Cartel”: Traders from four major banks allegedly formed a secret group known as “The Cartel” and made their banks billions by manipulating exchange rates. The banks admitted guilt but avoided major financial consequences, and none of the traders were prosecuted.
3) Deutsche Bank’s LIBOR settlement: After being accused of manipulating the key LIBOR benchmark on which $10 trillion in loan interest rates are based, Deutsche Bank paid a $775 million fine. The SEC continued to allow the bank to be treated as law-abiding.
4) Citigroup bonds: Citi’s investors lost out on $2 billion after the bank allegedly falsely claimed its highly leveraged bonds carried low risk. Citigroup ( settled with the SEC for $180 million but did not admit wrongdoing. )
5) Deutsche Bank’s derivatives settlement: The SEC fined Deutsche Bank $55 million after saying the bank hid losses of more than $1.5 billion during the financial crisis. The bank admitted no wrongdoing.
6) JPMorgan’s conflicts of interest: JPMorgan paid $307 million in fines to the SEC and the Commodity Futures Trading Commission for numerous alleged conflicts of interest in managing customers’ money. The fine amounted to less than 1% of the company’s annual profit.
7) EDMC’s high-pressure recruiters: The for-profit college received $11 billion in payments from students over the course of eight years after the DOJ said it had paid recruiters to bring in students. It settled for $95 million and admitted no wrongdoing.
8) Navient and servicemembers: The student loan servicer was accused of overcharging servicemembers for their loans and settled with the DOJ and FDIC for $100 million. The Department of Education took no action against Navient, Warren says.
9) GM’s ignition switch problem: Following a coverup of an ignition switch problem that caused a number of deaths and injuries, GM paid the DOJ a fine of $900 million, equal to less than 1% of the company’s annual sales. No criminal charges against any individuals were filed.
10) Honda’s airbag settlement: After failing to disclose 1,700 reports of injuries and deaths related to its faulty airbags, the National Highway Traffic Safety Administration fined Honda $70 million — the maximum allowable fine.