The Chickenshit Club

The Chickenshit Club
Jesse Eisinger
Simon & Schuster
2017

Great read. Well researched. It would have been a good novel, unfortunately it’s true.

If you read this book you will come away smarter but with much less faith and trust in the US Justice Department, the SEC and be more skeptical of corporations, the banks that finance them and the accountants that verify them.

Eisenger explains in detail the case of Enron and Arthur Anderson and how the companies and the individuals committed crimes including fraud and how they were brought to justice. WorldCom, Adelphia, Tyco International, and others also fell during the early 2000’s.

But ever since then and especially during the financial crises of 2007-2008 the DOJ and SEC have been very slow to indict corporations and hardly ever indict high ranking individuals. Case after case is discussed; Goldman Sachs, Bank of America, AIG, and on-and-on.

It seems that “too big to fail” actually means too big to prosecute. DOJ and the SEC have gone from going after corporations and individuals to no-admit, no-deny settlements that result in a fine. The fines tend to be looked at merely as a cost of doing business to the corporations

Among the reasons this trend has proliferated:

• DOJ sort of lost their balls as well as their litigating skills.
• DOJ, SEC and other agencies have a revolving door relationship with the corporations and defense attorneys.
• The heads of these agencies are political appointees who don’t know or don’t care.
• Afraid of failure or that the Appellate courts will reverse decisions.
• Worry that innocent stockholders will suffer if the corporation tanks.
• Worry that innocent employees will suffer if the corporation tanks.

There are few hero's in this book but you will love those that are mentioned. Their actions along with public fury at the status quo may just change the system