by Dr. Marsha Coleman-Adebayo, editor and columnist
Eric Holder has been praised as a “civil rights”-oriented attorney general, but the only rights he has championed are those of the bankers, white vigilantes and killer cops. “Holder refused to press charges against millionaire banking executives who, he assured Wall Street, ‘were too big to jail.’” Blacks have to make do with their Miranda warning rights – if they are lucky enough to survive an encounter with the police.
Holder’s Legacy: Corporate Criminals Too Big to Jail But Mass Incarceration, Gentrification and Protection of Killer Cops for Black Folks – Part II
by Dr. Marsha Coleman-Adebayo, editor and columnist
“All of his hard work and sacrifice on behalf of corporate American now culminates in the big payback.”
The most well-known Washington, DC secret is out in the open. In the tradition of “eyes wide shut”, former Attorney General Eric Holder has returned to his 900-attorney law-firm of Covington and Burling signifying that the rotating doors between the Department of Justice and corporate America are spinning quicker than a gyrating vortex.
Holder had served his corporate masters well during his stint as Attorney General: not a single indictment of a killer cop or Wall Street thief. After all, they, unlike the over one million black men in federal prisons (the majority of whom are serving time for non-violent crimes), were “too big to jail.” All of his hard work and sacrifice on behalf of corporate American now culminates in the big payback. When asked about Holder’s compensation as a partner in the law firm, Timothy Hester, Covington’s chairman, declined to comment.
As Attorney General, Holder earned $199,700 per year but he has returned to corporate high cotton. According to a recent National Law Journal article, entitled “Holder's Return to Covington Was Six Years in the Making”:
“[The] average profits per partner at Covington were more than six times that amount, at $1.335 million in 2014, and Holder would likely be among the highest-earning partners at the firm. In his last full year at Covington in 2008, Holder earned $2.1 million and another $2.5 million upon his departure in 2009.”
Holder’s reported net-worth is slightly under $11 million dollars. Not a bad retirement kitty for a civil servant cum corporate executive. But, one would be naïve to underestimate Holder’s future earning power for corporate America. Firm leaders, see him as a rainmaker. “I hope that’s part of the plan,” Holder said, when asked whether he will expect to “generate revenue.”
The problem is that none of this is illegal. In fact, it is the status quo.
“Holder would likely be among the highest-earning partners at the firm.”
Holder made his millions before his “investment” into public service by representing US corporate giants and international business concerns. According to a 2009 New York Times article:
“[When] Chiquita was facing the prospect of federal charges for paying protection money to Colombian terrorists to safeguard its banana crops, and the company needed help. It turned to Eric H. Holder Jr., an elite Washington lawyer well versed in the ways of the Justice Department. Thompson, the general counsel for Chiquita, recalled in an interview last week. As a former prosecutor, Mr. Holder ‘carries a level of credibility with him, and that’s a valuable commodity,’ he said.”
In another corporate “testimony,” the pharmaceutical Merck tapped Holder:
“…as its lawyer in a Medicaid overbilling case that ended in a $671 million civil settlement. And Rod R. Blagojevich, the now-impeached governor of Illinois, picked him, albeit briefly, to investigate for the state a controversy over a casino development and its possible ties to organized crime. When the National Football League was facing a legal and public-relations disaster in 2007 over a dogfighting scandal involving the Falcons quarterback Michael Vick, it turned to Mr. Holder to help navigate the maelstrom and represent the league.”
Holder’s corner office on the 11th floor on one of the most prestigious buildings in Washington, DC only tells one side of the story.
Under the Holder administration, the Justice Department fostered a climate of intimidation and fear within news agencies, particularly on national security matters. The Holder Justice Department:
“secretly subpoenaed phone records from Associated Press reporters and editors and used a search warrant to obtain some emails of a Fox News journalist as part of a separate leak investigation.”
The Obama Administration has successfully used the Department of Justice to terrify potential whistleblowers from exposing critical information through the ham-fisted utilization of the Espionage Act, with its potential for life imprisonment and the death penalty. Whistleblowers, such as, Edward Snowden or Chelsea (Bradley) Manning were publicly excoriated. Journalist Jake Tapper has asserted that the Obama administration: “has used the Espionage Act to go after whistleblowers who leaked to journalist…more than all previous administrations combined.”
While Holder slimed out of the Department of Justice there are obvious questions that needed answers: why did the Department of Justice refuse to prosecute police officers who killed black boys and men with impunity under his watch?; why the assault against whistleblowers?; and why didn’t Holder prosecute one white collar Wall Street criminal that engineered gentrification – the wholesale theft of black wealth and property – during his tenure?
“One would be naïve to underestimate Holder’s future earning power for corporate America.”
As black wealth, concentrated in the housing market was stolen by banks (called politely gentrification) such as Bank of America or Chase, with the complicit approval of the Department of Justice, we must thank Eric Holder. We also have to acknowledge that in the great tradition of white supremacy, “the sons and daughters of former slave owners” (to quote the phase from Dr. King’s 1964 March on Washington speech) quickly took advantage of the wholesale pilfering of black homes by banks in cities across American, such as, Detroit, Harlem, Oakland, Washington, DC, to swoop in and claim their white privilege.
Banks and the federal government advanced the propaganda that the disproportionate foreclosures of Black homes was a direct result of Blacks taking advantage of the banking system by assuming overburdened mortgages and that the foreclosures were simply a correction in the market. As in the Tamir Rice case, victims were being blamed for their victimization. For the white millennial, a sector of under-priced homes was suddenly available in city centers. After all, their presence would increase the tax base – the white man’s burden was as great in the 21st century as it was in the 15th century.
The banking sector was out of control and the Department of Justice had to determine whether it would prosecute high-level executives in the same manner that it pursues ordinary citizens, and specifically, African-Americans. August 2014, for instance, Bank of America agreed to pay about $17 billion to settle charges that two financial firms it now owns, Merrill Lynch and Countrywide Financial, marketed mortgage securities they knew to be backed by dubious home loans.
“Merrill Lynch and Countrywide sold billions of dollars of RMBS backed by toxic loans whose quality and level of risk they knowingly misrepresented to investors and the U.S. government,” Holder said in announcing the settlement. And it wasn’t the first time Bank of America had paid out. In 2011, it agreed to pay $8.5 billion to a group of investors, including the Federal Reserve Bank of New York that owned subprime securities issued by Countrywide. However, there was no announcement of any Bank of America executives being held criminally liable.”
Last November, JPMorgan Chase, the nation’s biggest bank, agreed to a $13 settlement with the Justice Department. “Without a doubt, the conduct uncovered in this investigation helped sow the seeds of the mortgage meltdown,” Holder said on that occasion: “JPMorgan was not the only financial institution during this period to knowingly bundle toxic loans and sell them to unsuspecting investors, but that is no excuse for the firm’s behavior.” The statement went on: “JPMorgan employees knew that the loans in question did not comply with those guidelines and were not otherwise appropriate for securitization, but they allowed the loans to be securitized—and those securities to be sold—without disclosing this information to investors.”
“For the white millennial, a sector of under-priced homes was suddenly available in city centers.”
In John Cassidy’s New Yorker article, “Why Didn’t Eric Holder Go After the Bankers?” he writes:
“… rather than seek to prosecute those responsible—and their superiors, if they knew what was going on—the Justice Department settled for cash… We seem to have stumbled into a new form of corporate regulation, in which nobody in the executive suite is held personally accountable for wrongdoing lower down the ranks, but the corporation and its stockholders are periodically socked with huge fines for past abuses... This argument, which came to be known as ‘too big to jail,’ caused widespread outrage, and for good reason. If big banks operate under different legal rules than the rest of us, it makes a mockery of democracy.”
A whistleblower from Chase Bank, Alayne Fleischmann, an attorney and deal manager at the bank, has stepped forward. She may become a primary witness in one of the largest white-collar cases in recent history:
"It was like watching an old lady get mugged on the street," she says. "I thought, 'I can't sit by any longer.'"
An article in RollingStone exposing the Feischmann revelations noted that JP Morgan Chase CEO Jamie Dimon “late last year paid $9 billion (not $13 billion as regularly reported…) to keep the public from hearing.” Fleischmann described “massive criminal securities fraud” in the bank’s mortgage operations:
“This past year she (Fleischmann) watched as Holder's Justice Department struck a series of historic settlement deals with Chase, Citigroup and Bank of America. The root bargain in these deals was cash for secrecy. The banks paid big fines, without trials or even judges – only secret negotiations that typically ended with the public shown nothing but vague, quasi-official papers called ‘statements of facts,’ which were conveniently devoid of anything like actual facts… And now, with Holder about to leave office and his Justice Department reportedly wrapping up its final settlements, the state is effectively putting the finishing touches on what will amount to a sweeping, industry wide effort to bury the facts of a whole generation of Wall Street corruption.”
Holder refused to press charges against millionaire banking executives who, he assured Wall Street, “were too big to jail.” Holder testified before the Senate Judiciary Committee during a hearing on Justice Department oversight. During the hearing, Sen. Chuck Grassley (R-Iowa) asked Holder about the "slippery slope" of the "too big to jail" mentality in cases of bank prosecution.
"I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if we do prosecute — if we do bring a criminal charge — it will have a negative impact on the national economy, perhaps even the world economy," Holder said. "I think that is a function of the fact that some of these institutions have become too large."
“If big banks operate under different legal rules than the rest of us, it makes a mockery of democracy.”
Senator Elizabeth Warren (D-Mass), in a push-back on the Holder “too big to jail” position lamented: "There are district attorneys and United States attorneys out there every day squeezing ordinary citizens on sometimes very thin grounds and taking them to trial in order to make an example, as they put it," she said. "I'm really concerned that 'too big to fail' has become 'too big for trial.'"
When Warren's questions were repeatedly dodged by Treasury's overseer of financial crimes, David Cohen and Federal Reserve governor Jerome Powell, she placed this debate in proper perspective:
"If you're caught with an ounce of cocaine, the chances are good you're going to go to jail. If it happens repeatedly, you may go to jail for the rest of your life… But evidently, if you launder nearly a billion dollars for drug cartels and violate international sanctions, your company pays a fine and you go home and sleep in your own bed at night – every single individual associated with this. I just -- I think that's fundamentally wrong."
While the Holder Department of Justice deemed corporations and their millionaire executives as “too big to jail” it equally pursued a position that millions of black folks were not too big to be eviscerated by the mass incarceration prison system. The Holder doctrine of “too big to jail is ethnically indefensible but totally consistent with his legacy.
Holder, for his part is satisfied with his political legacy: "I think I go out having accomplished a great deal in the areas that are of importance to me. I'm satisfied with the work we have done."
But in the end, Holder’s legacy will be summarized in one sentence: the Attorney General who waltzed with Wall Street robbers and exonerated the killers of two unarmed Black boys, George Zimmerman and Darryl Wilson, which triggered the first African-American mass resistance movement of the 21st century. Period.
As I noted in my 1/28/15 BAR article on Holder, mercifully, Eric Holder will ride off into the sunset of mediocrity where untold wealth via obscene honoraria, book deals and other million dollar opportunities await. May his opulent future be plagued with remorse and shame.
Dr. Marsha Coleman-Adebayo is the author of No FEAR: A Whistleblowers Triumph over Corruption and Retaliation at the EPA. She worked at the EPA for 18 years and blew the whistle on a US multinational corporation that endangered South African vanadium mine workers. Marsha's successful lawsuit led to the introduction and passage of the first civil rights and whistleblower law of the 21st century: the Notification of Federal Employees Anti-discrimination and Retaliation Act of 2002 (No FEAR Act). She is Director of Transparency and Accountability for the Green Shadow Cabinet, serves on the Advisory Board of ExposeFacts.com and coordinates the DC-based Hands-Up Coalition.