Next in the Financial Crisis: Possible Criminal Charges

Investors and taxpayers angry about the government bailout of seemingly mismanaged financial firms can probably count on a wave of criminal indictments in the months ahead, say white collar crime experts.

“I think we’re going to see some ‘perp’ walks,” says Columbia Law School Professor John Coffee, referring to the law enforcement practice of having the accused appear in public wearing handcuffs.

“I think its coming” says securities lawyer Jacob Zamansky, predicting the “outcry for culprits and scapegoats” will be met.

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Zamansky, Coffee and others say the government is now busy investigating likely wrongdoing that took place at dozens of firms and that it is just a matter of time before it yields results. But crisis management is taking precedence.

“The government and the private sector are focused on bailing out the ship right now, and rightly so,” says former SEC enforcement official Marvin G. Pickholz, now a partner at the New York law firm Duane Morris.

“I think most resources are being channeled toward solving the current crisis,” adds Harvey Pitt, who chaired the SEC during the government’s crackdown on accounting fraud at the beginning of the decade. “I think it will be months before any prosecutions occur, if at all.”

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