Felonies, Monumental Legal Reserves Just Part of TCOB These Days

This stuff is no big deal for banks anymore.

Once upon a time, not so long ago, a criminal conviction was akin to the death penalty for a publicly-traded company. Today, it is just a small part of a cost-benefit analysis.

Even as penalty after penalty is paid by big banks in various cases, it seems as though the same cast of corporate characters keeps reappearing. It makes you wonder whether the global banks are acting like teenagers who find it easier to beg forgiveness than actually change their behavior….

Banks appear willing to plead guilty as long as the collateral costs are not too heavy. Thus, the potency of a criminal conviction as a deterrent seems to have been dissipated, perhaps to the point that it is just another business expense. In a sense, they have become pleas without the baggage that comes with acknowledging guilt when all that is involved is the payment of fines, something that can be done as well in a civil proceeding.

Guilty Pleas and Heavy Fines Seem to Be Cost of Business for Wall St. [DealBook]