Bernie Sanders reacted to the news that the big banks pled guilty to manipulating currency markets by blunting saying that fraud is the business model on Wall Street.
In a statement, Sen. Sanders pulled no punched while calling for the breakup of the big banks:
Despite weak financial regulatory systems around the world, it seems that every week we hear about another multi-billion scandal involving a major financial institution. Today, we learn that JP Morgan Chase, Citigroup and other huge banks were fined $5.6 billion for rigging interest rates and manipulating currency exchanges. Sadly, this is just the tip of the iceberg. Since 2009, huge financial institutions have paid $176 billion in fines and settlement payments for fraudulent and unscrupulous activities. The reality is that seven years after too-big-to-fail banks crashed the economy, fraud still appears to be the business model on Wall Street.
Today, the six largest financial institutions have nearly $10 trillion in assets, equal to nearly 60 percent of our gross domestic product. They control more than two-thirds of the credit card market and one-third of the mortgages. These huge institutions are not only involved in fraudulent activities, they have grown even larger and more powerful since the Wall Street crash of 2008. They are not only an ongoing threat to taxpayers, but a burden on our entire economy.
In my view, the only effective way of dealing with these enormous financial institutions is to break them up. Today’s news is just another example of why these too- big-to-fail banks are too big to exist.
Sen. Sanders was correct. The big banks are an enterprise that is built on criminal fraud. Their greed is out of control, and the current punishments are severely lacking. The incentive to cheat and rig markets must be taken away.
Sanders has introduced two pieces of legislation in the Senate. The first is a bill to break up the big banks. The second piece of legislation would pay for free tuition at public colleges and universities with a tax on Wall Street.
Wall Street learned the wrong lesson from the Great Recession. The big banks learned only that their crimes won’t be punished. Until the American people demand that the big banks are broken up, the rigging and illegal criminal fraud will continue.