This week marked the eighth anniversary of the Lehman Brothers' bankruptcy, an event that triggered the financial crisis of 2008 and very nearly brought down the world financial system.
Since then, not a single banking executive or hedge fund manager has been prosecuted and critics charge that despite reforms, financial institutions are still engaging in risky behavior.
Sen. Elizabeth Warren (D-MA), a frequent critic of Wall Street, is calling on the U.S. Justice Department to release details of the investigation it conducted in the aftermath of the crisis. Specifically, she wants to know why not a single person has been held accountable.
The question is especially relevant, she argues, since it was recently disclosed that the Financial Crisis Inquiry Commission (FCIC) referred nine people and 14 companies to the Department of Justice (DOJ) in 2010, citing serious indications of violations of federal securities or other laws.
"The outcome of the referrals by the FCIC to the DOJ represents an abysmal failure,” Warren wrote in letter to the Office of Inspector General. “It means that key companies and individuals that were responsible for the financial crisis and were the cause of substantial hardship for millions of Americans faced no criminal charges. This failure is outrageous and baffling, and it requires an explanation."
The Lehman Bankruptcy stunned the financial world. The venerable institution collapsed because of its huge holdings in mortgage-backed securities, many of them subprime mortgages. When hundreds of thousands of those mortgages began to go into foreclosure in 2007, the securities became almost worthless.
Wants FBI documents released
Warren is also asking FBI Director James Comey to release the FBI's materials relating to the financial crisis investigation, especially any material on the nine individuals named in the FCIC documents. Since Comey released material relating to Hillary Clinton's email server investigation, Warren said it is only right that the public also get a look at what the FBI learned about the financial crisis.
"These new standards present a compelling case for public transparency around the fate of the FCIC referrals. I can think of no matter of ‘intense public interest' about which ‘the American people deserve the details' than the issue of what precisely happened to the criminal referrals that followed the 2008 crash." Warren wrote.
After the Lehman bankruptcy on September 12, 2008, other financial institutions also teetered on the brink. Congress approved $750 billion in additional government spending but the economy, already in a recession, plunged into the Great Recession, in which the unemployment rate surged past 10% in a matter of weeks.