MarketWatch attempts to answer the question that’s on (nearly) everybody’s mind: why, with the landslide of evidence pouring forth against them, have no Wall Street CEOs faced jail time?
Various experts, including Max, weighed in on the problems with prosecution, and while some believe that prosecution would be a worthwhile pursuit, most agree that it would be an uphill battle and certainly not the slam dunk it seems to the public. Here’s what Max had to say:
Moreover, the statute of limitations has run out on a lot of securities law claims, said Max Gardner, a consumer advocacy lawyer who’s been working in the foreclosure space. He adds that it’s difficult to pursue claims against securities sold by the banks these CEOs ran, because common-law fraud claims require a showing of intent.
“There’s also the representations and warranties in the securitization documents themselves, including that there is good title to the mortgages and that they’re not in default,” he said. “”It’s important to emphasize, however, that there could be suits against mortgage-backed securities sponsors, MBS servicers, and MBS trustees.”