U.S. Attorney General Eric Holder said a newly created interagency task force was focusing on financial fraud and targeting for possible prosecution bankers whose actions contributed to the financial crisis.
Speaking at a civic group meeting recently in West Palm Beach, Fla., Holder said the task force, which was created by President Barack Obama in November and met for the first time last month, would focus on fraud in mortgages, securities, economic stimulus programs and government bailouts.
He said the Justice Department and the task force also were investigating banks and other financial institutions whose failure to follow laws and regulations were in part to blame for the most serious financial crisis the United States has faced since the Great Depression.
"There are a number of investigations under way that I can't really comment on, that I think will ultimately hold accountable a fair number of people at some of these institutions who didn't make bad choices necessarily, but who really did wrong," Holder said.
"We expect that we can identify those people and make provable cases (and) we will bring them," he added.
He did not identify any specifically targeted institutions, but the comment came in response to a question about what the Justice Department was doing to address financial institutions considered too big to fail.
Holder said earlier in a speech the task force was making tackling financial fraud a priority, especially where this involved discrimination against minorities and the elderly.
"To those who see victimization of others as an avenue to wealth, take notice: If you fabricate a financial statement, if you propagate an investment scheme, if you are complicit in an act of financial fraud, you are writing your ticket to jail," he said.
Holder said financial crime had become all too common and Palm Beach "is, in many respects, ground zero for the $65 billion Ponzi scheme perpetrated by Bernard Madoff — the largest investor fraud case in our nation's history."
Madoff owned an 8,700-square foot home nearby. The mansion's value will be known when federal marshals auction it, Holder said.
"Last year, Allen Stanford, Tom Petters and, most recently, Fort Lauderdale attorney Scott Rothstein, who is alleged to have run a $1 billion investment scam, joined Bernie Madoff in becoming headline news and household names," Holder said.
"I'm proud that these men, along with more than 450 others convicted of corporate and securities fraud in 2009, have been taken out of the game."
Holder said the Justice Department was moving forward on more than 5,000 pending financial institution fraud cases and the FBI was investigating more than 2,800 mortgage fraud cases — up nearly 400 percent from five years ago.
Financial fraud has become an increasingly fraught political issue after a spike in mortgage scams and big Wall Street trading scandals.
The purpose of the task force, led by the Justice Department, is to investigate and prosecute financial crimes and to try to deter future fraud.
The task force replaced a similar one established by the Bush administration in 2002 after corporate scandals such as the collapse of Enron Corp, the giant energy trader.
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