SEC Plays Softball with Big Banks — NY Times (JPM, GS, BAC, C, DELL, GE, URI)

Over the last ten years, the US Securities and Exchange Commission (SEC) has offered nearly 350 waivers to the country’s biggest banks in cases when the banks might be punished for fraud, according to a report in The New York Times. Banks involved include JPMorgan Chase & Co. (NYSE: JPM), Goldman Sachs Group Inc. (NYSE: GS), and Bank of America Corp. (NYSE: BAC):

By granting exemptions to laws and regulations that act as a deterrent to securities fraud, the S.E.C. has let financial giants like JPMorganChase, Goldman Sachs and Bank of America continue to have advantages reserved for the most dependable companies, making it easier for them to raise money from investors, for example, and to avoid liability from lawsuits if their financial forecasts turn out to be wrong.

The paper reports that JP Morgan has settled 6 fraud cases in the last 13 years, and received SEC waivers in 22. Similarly, Bank of America/Merrill Lynch combined have settled 15 fraud cases and received waivers in 39 other cases.

The Times notes that only about a dozen companies have been fully punished by the SEC for misleading investors. These firms include Citigroup Inc. (NYSE: C), Dell Inc. (NASDAQ: DELL), General Electric Co. (NYSE: GE), and United Rentals Inc. (NYSE: URI). Citibank settled 6 fraud cases and received a waiver in 25 before losing its privileges in 2010.