Politics

Hillary Clinton Has A New Plan To Jail Bankers

CREDIT: AP Photo/Nati Harnik

In a sweeping reform plan set to be released later on Thursday, presidential candidate Hillary Clinton will propose pursuing criminal charges against individuals on Wall Street responsible for white collar crime leading up to the 2008 recession.

A summary of the plan the campaign provided to ThinkProgress follows up on her promise earlier this summer to “go beyond Dodd-Frank,” saying that the new policies she’s backing will “help ensure that middle class families never again have to bail out Wall Street.”

To accomplish this, the campaign asserts that “that the best way to deter corporate wrongdoing is to hold individuals accountable for their misconduct…That includes holding corporate officers and supervisors accountable when they knew about misconduct by their subordinates and failed to prevent it or stop it. When people commit crimes on Wall Street, they will be prosecuted and imprisoned.”

If elected president, Clinton would extend the statute of limitations for such crimes — such as fraud and misleading investors — past the current five or six years, to allow federal agents time to prepare a stronger case. She would encourage federal prosecutors to go after bankers and executives instead of just fining the entities that employ them.

“Banks and other financial firms have paid large fines for financial misconduct, totaling roughly $200 billion globally since the financial crisis,” the plan notes. “But too often it has seemed that the human beings responsible for corporate wrongdoing get off with limited consequences, or none at all.”

To ensure the federal agencies tasked with regulating Wall Street are able to do their jobs without interference from Congress, Clinton’s plan would also guarantee the Securities and Exchange Commission and Commodity Futures Trading Commission a separate source of funding. The plan would also ban executives found guilty of “a crime of dishonesty, breach of trust, or money laundering” from continuing to work in the financial industry — a current practice critics say has contributed to a culture of impunity on Wall Street. Additionally, Clinton would impose a tax on high-frequency trades, which she says have “enabled unfair and abusive trading strategies” in recent years. And under the plan, banks who settle with the government over white collars crimes would be forced to admit and detail their wrongdoing. She also endorsed a bill by Sen. Elizabeth Warren (D-MA) that would make the terms of such settlements more transparent to the public.

Because Clinton consulted on this plan with former House member and financial reform crusader Barney Frank (D-MA), it’s no surprise that many of the proposals are aimed at strengthening the 2010 Dodd-Frank law. But the plan may not go far enough for many progressives — who are expressing disappointment that she is not backing a new Glass-Steagall Act — also written by Warren — that would separate commercial and investment banking. The original Glass-Steagall Act was repealed when Clinton’s husband, Bill, was president.

Clinton’s deep, long-standing ties to Wall Street, which has given heavily to her campaign, has also given her rivals for the Democratic nomination room to question the sincerity of her new plan.

Clinton may also take heat for voting in 2008 to spend hundreds of billions of dollars to bail out Wall Street — a bill her rival Sen. Bernie Sanders (I-VT) strongly opposed.