Halah Touryalai writes an excellent article on why Wall Street has almost never admitted to wrongdoing in the past.
Any admission of guilt exposes the guilty party to liabilities for offenses against other parties. Case in point: Fannie Mae suing a total of nine big banks over Libor losses, four of which have already “admitted wrong doing in the global Libor investigation and have paid billions in penalties”.
The Obama administration’s Financial Fraud Enforcement Task Force has focused on getting these banks to pay fines of unprecedented size and admit wrong-doing. Finally, someone is holding Wall Street accountable.
We may not have seen head roll and prison sentences doled out as Matt Taibbi suggested in his Vampire Squid articles, but we are seeing a slow steady pressure applied that is gradually forcing Wall Street to shutter or greatly decrease its unethical activities.
For too long, Wall Street wistfully walked the line between illegal and unethical and got away with egregious cheating with little to no punishment. Now that their immunity has diminished, I think the market have a chance to regain more integrity and rationality. Diligence pays.