By Peter Schroeder - 04/01/13 04:56 PM EDT
"I am concerned that 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, perhaps even the world economy," he said. "And I think that is a function of the fact that some of these institutions have become too large."
Those remarks have emboldened Wall Street critics, who long believe the financial sector's bad actors got off easy in the wake of the financial crisis, who point to it as proof of a light handling of Wall Street by federal prosecutors.
"The top cops at the Justice Department have simply refused to hold banks accountable for criminal behavior," said Becky Bond, political director for mobile virtual network operator CREDO. "And now Attorney General Holder has actually come out and admitted that in his opinion the banks are simply too big to jail. If he won't prosecute, he should resign."
A spokesperson for the Justice Department pushed back against such critiques, maintaining that the Justice Department does not view any person or institution as above the law.
"What the Attorney General said is that the size of some of these institutions can increase the difficulty of already complex prosecutions, since federal prosecutors are required to consider – among other factors – the effect that a criminal prosecution may have on the thousands of investors, pension holders, customers, employees and the public - innocent people who had nothing to do with the criminal conduct," said the spokesperson. "These are among the many factors that we weigh - they are not bars to prosecution - and will not prevent the Justice Department from continuing to be aggressive and creative in pursuing prosecutions and seeking penalties in appropriate cases as we have been doing.”
Lawmakers in both parties criticized regulators following Holder's comments for their handling of bad actions by banks, pointing to the common tactic of simply seeking fines from institutions while steering clear of pursuing criminal charges.
"If you're caught with an ounce of cocaine, the chances are good you're going to jail," said Sen. Elizabeth Warren (D-Mass.) at a Senate Banking Committee hearing in March. "Evidently, if you launder nearly $1 billion for drug cartels and violate our international sanctions, your company pays a fine and you go home and sleep in your own bed at night."
This post updated Tuesday at 3:53 pm.