Book of the week: The Chickenshit Club

The Chickenshit Club coverThe Chickenshit Club: Why the Justice Department Fails to Prosecute Executives
by Jesse Eisinger
Published by Simon & Schuster, £20 (out on 10 August)
(Buy at Amazon)

A few weeks ago several former executives of Barclays Bank became the first top bankers to face criminal charges from actions related to the financial crisis. Prosecutions of top financial figures have been even rarer in America. In this book, investigative journalist Jesse Eisinger examines why prosecutors in the US have become increasingly reluctant to charge white-collar criminals.

Eisinger finds “an unmistakable decline” in the willingness and ability to prosecute corporate crime, says David Lynch in the FT. The key turning point was in the aftermath of the corporate scandals of 2001-2002.

After several convictions were reversed on appeal and other corporate cases misfired, senior officials grew more timid about white-collar cases. The author is particularly unsparing in his account of the Obama administration’s failure to hold bankers to account in the wake of the 2008 crisis.

Eisinger doesn’t consider that it may have been simply “too hard to prove” that the big players in the crisis violated the letter of the law, says James Kwak in The New York Times. Nevertheless, “Eisinger’s account has the ring of truth” about it.

The real conclusion is that “trust in institutions has collapsed”, says Guy Rolnik in Haaretz. Government prosecutors had “lost faith in themselves” and were afraid “to go against the big money”. This “loss of trust within the institutions” led to a loss of public trust in the institutions themselves.