Hensarling demands answers on Holder's big bank approach

Top Republicans on the House Financial Services Committee are demanding information from the Obama administration after Attorney General Eric Holder suggested some big banks may be "too big to jail."

In a letter sent Friday to Holder and Treasury Secretary Jack Lew, the Republicans said they had "deep concern" about Holder's remarks, and needed to know how the Justice Department goes about determining whether to pursue charges against large financial institutions, including what economic analysis is considered.

The letter was sent by House Financial Services Committee Chairman Jeb Hensarling (R-Texas) and Rep. Patrick McHenry (R-N.C.), who chairs the committee's oversight panel.

Holder set off a tumult of debate Wednesday, when he told members of the Senate Judiciary Committee that, effectively, he was unable to pursue cases he would like against massive financial institutions out of concern for what it could mean for the broader economy.

"The size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy,” he said. “That is a function of the fact that some of these institutions have become too large."

The next day, David Cohen, the Treasury's under secretary for terrorism and financial intelligence told lawmakers that Justice had approached Treasury when prosecutors were mulling charges for money-laundering violations by the bank HSBC. Cohen said Treasury decided it was unable to weigh in on the impact of criminal charges. HSBC ultimately was forced to pay $1.9 billion in fines, but no criminal charges were filed despite evidence of years of laundering for Mexican drug cartels and violations of U.S. sanctions against nations include Iran and Libya.

Holder had previously said Justice officials discuss the economic impact of charging financial institutions with "experts outside of the Justice Department."

The two House Republican lawmakers want to know more about how Holder's team evaluates the economic and financial risk of bringing charges against large financial institutions, including any records or communications of such analyses or attempts to procure that information.

The information would be used to evaluate the matter and "prepare for possible hearings," they wrote.

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