This bill — the Ending Too Big to Jail Act — would create a permanent law enforcement unit to investigate crimes at financial institutions; require senior executives (such as CEOs) at banks with $10 billion or more in assets to certify annually that they have conducted due diligence and found no criminal conduct or civil fraud within the financial institution; and mandate judicial oversight of deferred prosecution agreements (DPAs). Further specifics of this bill’s provisions are below:
Permanent investigative unit for financial crimes
The bill would create an investigative unit within the Treasury Department focused exclusively on investigating crime within financial institutions and conducting material loss reviews after institutions fail. It’d also reconstitute the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) as the Special Inspector General for Financial Institution Crime (SIGFIC) and expand its jurisdiction so that it can use its specialized skills and expertise, relationships with financial regulators and law enforcement agencies, and cross-jurisdictional view of the whole financial industry to investigate and help prosecute financial crimes.
Big bank executive certifications
The bill would require top executives of financial institutions larger than $10 billion to certify annually that they have conducted due diligence and found no criminal conduct or civil fraud within their institution. Bank executives often pled ignorance to wrongdoing during the financial crisis, and requiring executives to perform due diligence under penalty of perjury would deter them from insulating themselves from accountability by forcing them to keep track of the conduct at their banks.
Judicial oversight of deferred prosecution agreements (DPAs)
This bill would give courts authority to approve and oversee compliance with DPAs. After the financial crisis, the Justice Department (DOJ) often entered into unreviewable DPAs with financial institutions instead of going after individual executives. This bill would mandate judicial oversight of these agreements, requiring courts to determine that an agreement is in the "public interest" before it can take effect and allowing courts to supervise implementation, request status reports, approve termination, and order that documents be filed on the public docket. The DOJ would also be required to establish a public searchable database of DPAs.