This hearing on the practices and procedures of the depository regulatory agencies and the Department of Justice examined the identification and prosecution of criminal violations of Federal laws by officers, directors, and insiders of financial institutions.
The hearing was conducted to determine if the present system of criminal enforcement is working efficiently to identify and prosecute criminal violations of the banking laws in order to deter future misconduct and to protect the financial system against unsafe and unsound practices. It is important to determine if there can be effective prosecution of criminal violations if neither the Justice Department nor the banking agencies maintain centralized files on such violations and if they fail to track the disposition of criminal referrals. Whether the criminal statutes and decided cases deal appropriately with modern computerized depository practices and whether the responsibility of the regulators to promote and safeguard the banking system conflicts with their responsibility to identify and punish wrongdoers were also discussed. Witnesses included general consuls for the Federal Deposit Insurance Corporation (FDIC), the Federal Home Loan Bank, and the National Credit Union Association; representatives of the FBl and the Department of Justice, including the Acting Assistant Attorney General; law school professors; and representatives from the Federal Reserve System and the Comptroller of the Currency. Extensive appended materials include letters from affected agencies, surveys of criminal referrals involving failed banks and savings and loans, documents on fidelity bond coverage and claims filed by the FDIC and the Federal Savings and Loan Insurance Corporation in failed institutions, and numerous miscellaneous documents and press materials.