Krawcheck: I Never Saw a Law Broken on Wall Street

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Sept. 9 (Bloomberg) -- Bloomberg Contributing Editor Neil Barofsky and Former Bank of America's Sallie Krawcheck discuss the climate and attitudes on Wall Street five years after the banking crisis on Bloomberg Television's "Market Makers." (Source: Bloomberg)

Week, james gorman of morgan stanley says that things are really not that bad out there.

You go to jail if you commit a crime.

There is a difference between incompetence or mismanagement or poor judgment or excessive risk- taking from actually raking a law -- actually breaking a lot.

As much as we like to find people to put in jail, you have to look at the credit that the system is built around.

Clearly, he is defending those bank ceos.

Do you think there is criminal activity or accountability at the top?

I never saw criminal activity.

I'll go further, i never saw a client call the muppet.

It's not a crime to call him a muppet.

I saw overconfidence.

I saw a bad decision.

I saw too much leverage.

I saw short-term thinking.

I thought a lot about this and written about this and site have been gone.

But i never saw a lot broken to my knowledge.

Based on corners being cut over and over, when investors were searching for yield, banks are creating products that maybe people do not understand what they were getting into.

Where is the line between bad decision and shouldn't have been done?

It is clear it shouldn't have been done.

But it will take it a step further.

Bankers who were selling these products, they didn't know -- they didn't understand what they were getting into.

The equity holders were right there saying more earnings, more earnings, mornings.

Is james gorman defending the street -- again, you are a lawyer -- is he telling you like it is?

Even the sec could not bring itself to find civil wrongdoing at lehman brothers.

There are no criminal prosecutions as a result.

But your question about accountability, the answer is sadly no.

How do you enforce accountability?

If you don't have a case to bring -- the department of justice has not brought these cases.

In a way, he has been proven correct by events.

There was criminal activity going on at these firms.

You had an entire securities segment of the market called liar loads.

The justice department hasn't been able to prove those cases so they haven't happened.

But they're still an opportunity for accountability even outside of the department of justice.

One of the reasons that i'm going to a from my gender is that there has been accountability to some extent in the negation -- in civil cases.

This text has been automatically generated. It may not be 100% accurate.


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