A new study out from Syracuse University shows that the number of federal prosecutions for fraud at financial institutions has been steadily decreasing since 1999. [via ThinkProgress]
This is particularly interesting given that in the wake of the 2008 financial crisis, public sentiment towards banks and other financial firms have been generally negative and prone to suspicion.
The falling number of fraud prosecutions is striking given what many claim is a strong pattern of financial-sector misconduct in recent years, culminating in a housing crisis characterised by alleged rampant mortgage fraud and improper foreclosure, as well as the weakening of the national and global economy.
The chart below tracks the number of prosecutions since 1991, and is colour-coded based on presidential terms.
The biggest decline appears to have been during former President George W. Bush’s eight-year term, but the downswing continues under President Obama. There is also a chance that the number of prosecuted cases could have dropped off in the wake of the 9/11 attacks as the federal government concentrated more effort and money towards anti-terrorism measures, Eichler noted.
The study estimated that there will be 1,365 persecutions for financial fraud this year, which is down 57% from a decade ago, and a 26.8% decrease from five years ago. The data was obtained via a Freedom of Information Act filing by the Transactional Records Access Clearinghouse at Syracuse.