Attorney General Eric Holder Discusses Financial Fraud at World Leaders Forum

Attorney General Eric H. Holder, Jr. (CC’73, Law’76), speaking Feb. 23 at a World Leaders Forum at Columbia, said that the Obama Administration has aggressively investigated the fraud and corruption that fueled the 2008 economic crisis.

Holder, a University trustee from 2007 to 2009, counted among the Justice Department’s accomplishments a landmark, multi-billion-dollar settlement with top banks, major gains in healthcare fraud protection and new, specialized groups working to strengthen the department’s investigations.

“From securities, bank and investment fraud to mortgage, consumer and healthcare fraud, we’ve found that these schemes are as diverse as the imaginations of those who perpetrate them and as sophisticated as modern technology will permit,” said Holder, the nation’s 82nd attorney general and the first African American in the post. He also noted, "Much of the conduct that led to the financial crisis was unethical and irresponsible, but we have also discovered that some of this behavior, while morally reprehensible, may not have been criminal."

Earlier this month, the federal government, in conjunction with states’ attorneys general, reached a $25 billion settlement with Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial to address mortgage loan and foreclosure abuses. The agreement, which Holder said is the largest federal-state civil settlement ever obtained, will provide financial relief to homeowners and more robust protection for future homeowners. Last year, the government recovered a record-setting $4.1 billion from companies and individuals who committed healthcare fraud, Holder reported to the audience of 400 that included four U.S. attorneys.

“People are always going to be trying to game the system and steal from taxpayers,” said Holder. “For the Justice Department, this is a call to action.” Holder also explained how the Justice Department has created new task forces that are expanding investigations of white-collar crime. One working group, formed earlier this year and led by New York State Attorney General Eric Schneiderman, is investigating whether banks and financial institutions committed fraud when they bundled home mortgages and sold them on the international securities market. Another group is fighting consumer-targeted fraud, Holder said.

Sworn in Feb. 3, 2009, Holder is the second consecutive Columbia graduate to serve as the attorney general, succeeding Michael Mukasey (CC’63). It is also his second time working in the Justice Department, having been appointed deputy attorney general by President Bill Clinton in 1997, the first African-American to hold that position as well. He was named an associate judge of the Superior Court of the District of Columbia by President Ronald Reagan. Born in the Bronx and raised in Queens, he attended Stuyvesant High School.

“In Eric Holder, we have an attorney general who is not afraid of the hard choices that must be made to pursue justice and fulfill our founding ideals,” said University President Lee C. Bollinger , who established the World Leaders Forum in 2003 as platform to for economic, political and social discussion.

During the question-and-answer portion of the event, Bollinger asked Holder about affirmative action, an issue he championed as president of the University of Michigan in Grutter v. Bollinger, a case in which the U.S. Supreme Court upheld the practice. This week, the court agreed to take on another race-based college admissions case involving the University of Texas.

Holder suggested, regretfully, that the court’s decision to hear the new case might signal an impending end to the practice. “I can’t imagine a time where the need for diversity will ever cease,” he said.

Holder also reflected upon his days at the University. “I consider the seven years I spent in Morningside Heights as one of the greatest blessings in my life,” he said. “My time at Columbia shaped my life in ways I’m still realizing.”

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