After not prosecuting any of the Wall St firms responsible for the market collapse in 2008, ex-Attorney General Eric Holder is going back to Covington & Burling, a corporate law firm that represents Wall St clients.
The revolving door, which stands as one of the worst examples of regulators being cosy with the industry they’re supposed to be regulating, had Holder working at Covington from 2001 until becoming attorney general in Feburary 2009. During his tenure in government Covington actually kept an office empty for him, awaiting his return.
To precisely quantify just how conflicted Holder was as attorney general, the Covington & Burling client list has Bank of America, Citigroup, JPMorgan Chase and Wells Fargo on it. In addition to all being involved in various highly criminal yet unprosecuted acts, Covington just represented Citigroup in a lawsuit over the bank’s role in Libor manipulation.
According to a reuters report “Court records show that Covington, in the late 1990s, provided legal opinion letters needed to create MERS on behalf of Fannie Mae, Freddie Mac, Bank of America, JPMorgan Chase and several other large banks.”
The Department of Justice under Holder not only allowed billion dollar frauds like that of MF Global avoid prosecution but also classified mortgage related securities fraud as the “lowest-ranked criminal threat,” according to the inspector general.
Holder’s former deputy chief of staff, James Garland, was also from the firm and rejoined Covington in 2010. The firm even represented clients before the Department of Justice while awaiting Holder’s return. GlaxoSmithKline was one of the benefactors of this as it was represented for a plea agreement in 2010.
Holder’s career is remembered for institutionalizing “Too Big to Prosecute” rules within the department, resulting in JP Morgan committing over $35 billion of crime yet receiving only a series of fines which were vastly lower than the ill-gotten gains.
Upon his return to Covington Holder will become among the highest-paid partners at the firm, with compensation reported to be over $10 million per year.
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