News / USA

Official Says US Using 'Every Tool' To Fight Financial Crime

Eric Holder, US Attorney General
Eric Holder, US Attorney General

U.S. Attorney General Eric Holder told a bipartisan commission exploring the root causes of the 2008 global financial crisis the Justice Department is using "every tool at our disposal" to fight the mortgage fraud and other crimes that contributed to the near-financial collapse.

Attorney General Holder told the commission the Federal Bureau of Investigation is investigating more than 2,800 cases of mortgage fraud, and that the Justice Department is determined to take forceful action to punish the white-collar [business] criminals that contributed to the crisis that has hurt so many ordinary Americans.

"The Justice Department is using every tool at our disposal, including new resources, advanced technologies and communications capabilities and the very best talent that we have to prevent, to prosecute and to punish these crimes," he said. 

Holder said tough law enforcement should also prove a deterrent to future wrongdoing. "And by taking dramatic action, our goal is not just to hold accountable those whose conduct may have contributed to the last meltdown, but to deter such future conduct as well," he said.

The nation's top law enforcement official testified during the second day of hearings on Capitol Hill by the Financial Inquiry Commission, created by Congress to examine the causes of the financial crisis.  Senior U.S. regulators testified after top Wall Street bankers defended their actions before the panel on Wednesday. 

Federal Deposit Insurance Corporation Chairman Sheila Bair said the crisis exposed fundamental weaknesses in the U.S. regulatory system, and called for major reforms. "We are now poised to effect far-reaching reforms that will affect how we regulate the entire financial system.  Our approach must be holistic and give regulators the tools to assess risks throughout the system," he said.

President Barack Obama is pushing Congress to overhaul the U.S. financial regulation system.  The House of Representatives approved a sweeping financial reform bill last month, over the objections of many Republican lawmakers and bank lobbyists.  The Senate Banking Committee is working on its own financial system reform bill, and the Senate is expected to take action later this year.

Meanwhile, President Obama proposed a new "financial responsibility fee" on big banks and financial institutions to recover about $100 million in expected losses on federal bailout money paid to the banks.  The president said many banks helped cause the financial crisis by engaging in reckless behavior, with the result of millions of Americans losing their jobs, their homes and their life savings.

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