The Republicans have held up the Senate confirmation of Loretta Lynch as attorney general for six unseemly months -- based not upon on her disturbing refusal to prosecute a drug-trafficking, money-laundering, terror-profiting mega-bank, but because of their feigned concern that victims of sex-trafficking might get government-funded abortions.
The Democrats, although rightly calling out the Grim Old Party for its hypocrisy and dog-whistle racism, are turning a willful blind eye to Lynch's (at worst) corruption and (at best) ineptitude. Not only did she fail to prosecute HSBC bankers for their original crimes, she's failed to prosecute them for pissing all over the sweethheart deal she gave them. The bank continued to shield wealthy clients who hide their cash in Switzerland to evade taxes. Loretta knew it, and did nothing.
But Al Sharpton (allegedly) went on a hunger strike to protest GOP treatment of her. Democratic Whip Dick Durbin compared her to Rosa Parks, as though Lynch is some kind of civil rights icon rather than a revolving-door corporate lawyer who has spent much of her professional life defending white collar criminals. Even Elizabeth Warren, who can normally be counted upon to call out Wall Street corruption and government complicity and regulatory capture wherever she sees it, is staying weirdly mum on this one.
Only the Shadow knows, and the Shadow is not telling. But I suspect it has something to do with party loyalty and wedge issues and identity politics and winning, winning, winning at all and any costs.
Before the Republicans accepted their plutocratic marching orders, fulfilling their assigned role of forcing Democrats to circle the wagons around Loretta Lynch out of misplaced gender, racial and party loyalty, there were, in fact, vague murmurings about her cozy relationship with Big Finance. Dave Dayen described the history in a Salon piece last fall:
Lynch’s first job was as a litigation associate at Cahill Gordon & Reindel in the mid-1980s. Their litigation department includes the legendary First Amendment lawyer Floyd Abrams, who defended the New York Times in the Pentagon Papers case (Abrams subsequently argued the Citizens United case, on “campaign money is speech” grounds). But it also does a great deal of white-collar defense in securities and antitrust law, representing companies like AIG, HSBC, Credit Suisse, Bank of America and more. It’s a corporate law firm.To be fair, she did much pro bono work during her private career, and is rightly revered for successfully prosecuting the notorious Abner Louima gang assault-by-cop.
Lynch then served at the U.S. attorney’s office in Brooklyn for 11 years, rising to run the office during the end of the Clinton administration, from 1999 to 2001. When she left, she became a partner at Hogan & Hartson (it has since merged to become Hogan Lovells). It’s a giant D.C. law firm specializing in government regulatory, corporate and financial law. Like Cahill Gordon & Reindel, it advises all sorts of corporations, and it even has a separate lobbying firm, one of the top five in the United States. We know that Lynch worked on white-collar criminal defense and corporate compliance while in private practice at Hogan & Hartson.
Eventually, Lynch went back to run the U.S. attorney’s office in Brooklyn for a second stint in 2010, serving there until her nomination for attorney general. But in between, she worked in corporate law and white-collar criminal defense at two mega-law firms for nearly two decades.
But another troubling -- and kind of strange -- aspect of her professional biography is her directorship of the New York Federal Reserve Board between 2003 and 2005, and her important role in getting that man-o-the people, future Obama treasury consigliere Tim Geithner, appointed as NY Fed president -- just in time for the Big Meltdown of 2008, which nobody could ever have predicted. (wing, nod, cough.)
And then quick as a wink and a hack, Loretta Lynch spun through the revolving doors to the Brooklyn US Attorney's Office, where she was responsible for
The HSBC deal was even worse. Not only was a major crime against humanity by the banking mafia swept under the rug via a deferred prosecution deal, the foxy cop (Lynch) in charge of the foxes in charge of hen-house apparently knew almost from the get-go that HSBC was reneging on its promise to behave itself and police itself. At the same time that the bankers admitted to aiding and abetting a consortium of vicious drug cartels, they were hiding about $120 billion of their wealthy clients' money. She saw something and didn't say something.
Rolling Stone's Matt Taibbi described it as only Matt Taibbi can:
The DOJ acted very tough after the 2012 deferred-prosecution deal, swaggering in a strangely self-congratulatory public ceremony. Then-Criminal Division chief Lanny Breuer shared a podium with Loretta Lynch here in New York, detailing how the bank's Mexican branches had fashioned specially-made teller windows so that drug gangs could more quickly slide in their cash.The equally indispensable William Black notes that the Obama Justice Department has been effectively captured by conservative economist-think, and that far from punishing HSBC officials, Lynch has actually gone out of her way to praise money-launderers and the aiders and abettors of alleged foreign terrorists. While the DOJ pleads that such banks are too big and too vital to jail, Black points out that government failure to prosecute them is a recipe for the next inevitable financial disaster. Read his whole piece, and weep.
Still, no individual had to pay a dime in fines, and nobody was charged. In fact, the harshest penalty any individual at HSBC had to suffer in that case was the partial deferral of some bonuses.
hat looked bad back then, but now the Breuer/Lynch deal looks preposterous even by Eric Holder's standards. If our government knew back then that HSBC had been engaged in a sweeping global tax-evasion scheme, how could it have dealt out such a sweetheart deal on the money-laundering caper after being so informed?
This is a little like dropping a felony burglary charge to misdemeanor trespassing at a time when you've found out that your bug-eyed suspect with the rope and zip-ties in his trunk is wanted in a string of violent home invasions in another state. It's inexplicable, something no sane law enforcement official would ever entertain.
"Will the HSBC deal come back to haunt Loretta Lynch?" Taibbi rhetorically and hilariously asked just a few short months ago.
The stunning answer is that far from being haunted, Loretta Lynch is now being celebrated by the Democratic Party as a feminist icon and martyr, a hostage who is now so gloriously rescued from GOP perfidy. Loretta Lynch is such a compelling symbol of the liberal brand that all indications are that she will continue to serve under a President Hillary Clinton, whose campaign arm had been circulating a fund-raising petition in her honor.
A grand bipartisan bill to combat sex trafficking will be forever positively linked to Loretta Lynch's name. Never mind that the whole controversy was a contrivance, in which Democrats pretended not to notice that the GOP had attached an anti-abortion clause to the original measure. This opened the way to five months of wedge-issue fundraising and five months of rebranding Loretta Lynch and forgetting all about her personal sleaze factor and her actual suitability for the job.
Al Sharpton can finally eat again.