Frontline Gets Its Man: Lanny Breuer Leaves DOJ After Exposé

Submitted by Mary Bottari on

In a testament to the power of independent media, the award-winning public television show Frontline this week helped push a top Department of Justice (DOJ) official out the door.

On Tuesday, Frontline aired a report called "The Untouchables" detailing the DOJ's failure to prosecute the big banks for the 2008 financial meltdown and zeroing in on Lanny Breuer, the former White House legal counsel for Clinton who headed the DOJ's criminal division under Obama.

 

On Wednesday, the Washington Post reported that Breuer was stepping down.

Breuer's Legacy: Enshrining "Too Big to Jail" as Legal Precedent

Many had criticized Attorney General Eric Holder and Breuer for failing to take action against the mega banks on Wall Street, and watched with disbelief last December as the DOJ decided to pass on criminal penalties against HSBC for laundering drug money and helping to finance terrorists. The behemoth bank was ordered to pay a record civil fine, but no criminal charges were lodged against any HSBC official. A New York Times editorial called the decision a "dark day for the rule of law."

But this time around, the Frontline crew had unparalleled access to Breuer which generated a number of key revelations:

Frontline documented that Breuer/Holder failed to use the tools available to them to really dig.

FRONTLINE: We spoke to a couple of sources from within the Criminal Division, and they reported that when it came to Wall Street, there were no investigations going on. There were no subpoenas, no document reviews, no wiretaps.

BREUER: Well, I don't know who you spoke with because we have looked hard at the very types of matters that you're talking about.

Frontline documented that Breuer/Holder failed to reach out to key whistle blowers.

FRONTLINE: Another criticism that has been thrown at you is that you've not done enough to go looking for the whistle-blowers that are out there. We have been able to contact a number of people who were inside the banks, doing due diligence work as contractors, who all told us that they were never contacted by the Justice Department.

BREUER: I can't talk in general about nondescript, anonymous whistle-blowers. But here's what I can tell you. Whenever I personally have been in any public setting, I've invited whistle-blowers to come forward.

Frontline documented that Breuer/Holder worried more about the fragility of the banks than cleaning up corruption on Wall Street.

FRONTLINE: You gave a speech before the New York Bar Association. You talked about your use of nonprosecution and deferred prosecution agreements. And in that speech, you made a reference to "losing sleep at night over worrying about what a lawsuit might result in at a large financial institution." Is that really the job of a prosecutor, to worry about anything other than simply pursuing justice?

BREUER: I think I and prosecutors around the country, being responsible, should speak to regulators, should speak to experts, because if I bring a case against institution A, and as a result of bringing that case there's some huge economic effect, it affects the economy so that employees who had nothing to do with the wrongdoing of the company... If it creates a ripple effect so that suddenly counterparties and other financial institutions or other companies that had nothing to do with this are affected badly, it's a factor we need to know and understand.

Just this week Pro Publica put out another blockbuster report about the corruption at Morgan Stanley before the financial meltdown, unveiling documents where employees dubbed the securities they were peddling: "Subprime Meltdown," "Nuclear Holocaust," and of course "Shitbag." This information was garnered not from the federal government prosecutions, but from a private lawsuit against the bank.

Before his appointment at the DOJ, Breuer had worked at the Washington office of Covington & Burling LLP alongside Holder. The firm specializes in helping big name corporations, including tobacco firms, evade taxes and get off the hook for crimes and malfeasance. Breuer is likely to return to that natural perch, unfortunately he will be leaving Holder behind to continue business as usual at the DOJ.

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Mary Bottari
Mary Bottari

Mary Bottari is a reporter for the Center for Media and Democracy (CMD). She helped launch CMD's award-winning ALEC Exposed investigation and is a two-time recipient of the Sidney Prize for public interest journalism from the Sidney Hillman Foundation.

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Comments

Anonymous replied on

Justice isn't blind, but the public is. So, we get what we are. For example, a recent lawsuit filed in the US Court of Federal Claims, by a vet who claims that it's the US government--not Chase and the big banks--that are responsible foreclosing on millions of VA- and other federally insured home loans. If your loan was federally-insured and a "bank stole" it in foreclosure, under certain conditions the US government should be held accountable. That's why Fannie Mae, Freddie Mac and VA-insured loans AREN'T part of the National Mortgage settlement. The US government can't settle with itself, for letting Chase and other banks take your home--because the federal government knew or should have known, what was going on since in many cases, the banks didn't have the proper paperwork, to foreclose anyway. They only had ACCESS to YOUR LOAN FILE--which they got by working with the federal government to service your loan or "safe guard" the paperwork. Yet, NO ONE is talking about it. WHY? Many attorneys know this is the case--but, no one "discusses" it on the Internet. The only way this can occur is that MANY judges, attorneys, real estate agents and government employees are IN on this--it boggles the mind. The reason this CROOK resigned, is that he MIGHT have a conscience. What about the rest of them, that know what's going on and are HELPING to pull off the second biggest land grab in the US, since the settlers took the land from the Native Americans? See the video on our YouTube Channel, "4 Justice Radio". Read the complaint summary on Scribd.com, search "Veterans Foreclosures" on the second page of the search results you'll see the complaint, "VA Veteran v. United States", the case is #13-11. If you have any questions call me at 608.622.7009 Thanks, Justice Journalist Host http://4justiceradio.com "Exposing Injustice"

Concerned citizen replied on

There must be circumstances that caused charges to be NEVER brought against senior bank executives in one of the biggest financial failures in U.S. history. Our economy has not recovered, and the banks have not fixed the problems that created this fiasco in the first place. Banks colluded and created risky financial instruments and violated their fiduciary duties to U.S. citizens and institutions in the U.S. and abroad for YEARS without repercussions. There absolutely is fraud. Any 5-year old can tell you that.

George Hartzman replied on

I am the George Hartzman Rolling Stone's Matt Taibbi wrote of the other week, and I believe Wachovia CEO Robert Steel bought Wachovia’s stock in a breach of trust, confidence and his fiduciary duty to shareholders, US taxpayers and our legal system, while in possession of material, nonpublic information. On July 9, 2008, Robert Steel became president and CEO of Wachovia after working for Goldman Sachs from 1976 to 2004 and the US Treasury under former Goldman Sachs CEO Henry Paulson from October 10, 2006 until July 9, 2008. Mr. Steel was “the principal adviser to the secretary on matters of domestic finance and led the department's activities regarding the U.S. financial system, fiscal policy and operations, governmental assets and liabilities, and related economic matters,” according to Wikipedia’s biography. Mr. Steel most likely knew about other firm’s borrowings via his time spent at the U.S. Treasury Department. On July 22, 2008, Mr. Steel personally purchased 1,000,000 shares of Wachovia’s stock as the company’s undisclosed Federal Reserve Term Auction Facility (TAF) borrowing reached $12.5 billion, which appears not to have been disclosed in securities filings audited by KPMG. In an interview with CNBC's Jim Cramer On Monday, September 15, 2008, Robert Steel said "I think it's really about...transparency. People have to understand the assets and really be able to say, this is what I own... Complete disclosure. ...we can work through this with transparency, liquidity and capital. ...Our strategy was to give you all the data so you could make your own model. We tell you what we're doing... ...we're raising capital ourselves by basically shrinking the balance sheet, cutting the dividend, cutting expenses. We can create more capital ourselves that way... for now, we feel like we can work through this..." After Jim Cramer asked "Should there be any sort of quick regulatory relief from the SEC that would make life easier to be able to make your bank much stronger?", Mr. Steel responded "I don't think it's about my bank." After not reporting TAF loans, Wachovia's CEO wrote "I, Robert K. Steel, certify that: I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 of Wachovia Corporation; Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report" on October 30, 2008. Mr. Steel was at least aware of Wachovia’s Federal Reserve loans since July, 2012, if not the undisclosed loans to multiples of other financial institutions. If Mr. Steel was “the principal adviser…on matters of domestic finance and led the department's activities regarding the U.S. financial system, fiscal policy and operations”, how could he not have known and acted on undisclosed material information? On June 22, 2010, Robert Steel was appointed Deputy Mayor for Economic Development by New York City Mayor Michael Bloomberg, after which, Steel resigned his seat on the Wells Fargo board. According to Morningstar data, Mr. Steel owned 601,903 shares of Wells Fargo in 2010, which would be worth $20,446,644.91 as of October 26, 2012. George Hartzman Greensboro, North Carolina

Anonymous replied on

Frontline: thank you for your fantastic but long overdue report. Frankly, the resignation of government officials like Breuer are essentially irrelevant. President Obama ran on the agenda of leveling the playing field for the American people. The one sure way he can add substance to that agenda is to proceed quickly with the indictment & prosecution of those top bankers and not the "small fish" that we keep hearing about. Had it not been for these top executive bankers of this country, we wouldn't have seen the unprecedented collective robbery that we have had to endured and will continue to pay the price for years to come. The one real way to convince us all that the justice system still works in this country is to nail these bastards that are still laughing their way to their banks; Hog Heaven indeed! The outcome will be a renewed sense of justice while restoring our faith on our financial system.

distantviews replied on

I watched the Frontline program and was astounded by Breuer's glib prevarications. It was as if he, himself, didn't believe the lies, but like a crook caught red handed, he did his deceitful best to dodge the questions and to avoid detection. Anyone who has ever witnessed a liar trying to avoid getting caught could plainly see that LIAR was writ large on his despicable face. The question I have is not if Breuer found a conscience and resigned or whether he was asked to leave, but why is Holder still the AG? He is ultimately responsible for the Justice Department and Obama is responsible for both of them. I say, impeach Holder (is that possible?) and then go after Obama. They have both colluded with financial terrorists to keep the culprits out of jail. Bring back Elliott Spitzer.

Jadeba replied on

I suspect the culprit is Tim Geithner who stood in the way of reform and prosecution in favor of "confidence" in the markets. It's why banks did not take the "haircuts" they, at minimum, should have. It is shameful.

Anonymous replied on

How DO men (these weasels don't deserve to be called men) like BREUER and HOLDER sleep at night? Probably very well indeed! As PBS FRONTLINE showed, people like BREUER have become UNTOUCHABLE. Just like the Royalty of past ages was untouchable and could get away with anything. These lying cowards are corrupt to their very marrow and will NOT prosecute those who caused the financial meltdown even though they know each and everyone one of these criminals by name. The problem is that BREUR and HOLDER used to work with a lot of these criminals BEFORE they went to work at the DOJ. Now BREUER has gone back to work with his criminal friends THE DAY AFTER PBS' FRONTLINE REVEALED HIS HYPOCRISY TO THE WORLD but not before chastising PBS and FRONTLINE for having had the gall to EXPOSE HIS HYPOCRISY, INAPTITUDE, AND OUTRIGHT lies on national TV. Why else would BREUER leave the DOJ if what PBS's FRONTLINE reported was NOT true. These high rolling lawyers, their Bank CEO buddies, and many members of the US government ARE THE NEW ROYALS! The Brits are still romantically holding on to their royals while the French got it right and got rid of theirs. Isn't it time that Americans EXPOSE and JAIL these new royals who have brought the country down to its knees? PBS and FRONTLINE had the balls and the guts to go after these manipulating morons. Now it's our turn--the people's turn--to DEMAND THE WHOLE TRUTH and to DEMAND JUSTICE. Let's stop this BS of allowing banks and corporations to send their people to serve in government departments so that that they can then protect and insulate those very banks and corporations from JUSTICE! WTF is going on in this country? DOES ANYONE EVEN CARE? Why did BREUER NOT indite or arrest or prosecute even 1 Wall Street Banker responsible for the meltdown? Why did no one fire BREUER's ass or indite and prosecute HIM for NOT having done his job and put some of his old friends in jail?! If Americans do NOT wake up to this BS that is parading as legit government business on a daily basis, the USA will self destruct from within. We used to be afraid of a NAZI and COMMUNIST takeover; now our worst enemy are our own US lawyers, US corporations, and many members of the US government itself. When will the American people WAKE UP and do something about this intolerable BS!

Anonymous replied on

Could it be that the justice system is so convoluted that it is next to impossible to prove "reasonable doubt" about a crime? Getting a conviction from a jury and swaying a movie/television audience are two completely different animals. Maybe we should take a look at the system itself. Remember, OJ got away too, and was only convicted in civil court...

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