At the onset, allow me to point out that the Department of Labor (DOL) claims to have issued the exemptions “to protect Covered Plans that entrust substantial assets” to these institutions, but that is no excuse for the ongoing tolerance for abuse. In part, the notice states:
In accordance with section 408(a) of the Act and/or section 4975(c)(2) of the Code and the procedures set forth in 29 CFR part 2570, subpart B (76 FR 66637, 66644, October 27, 2011)  and based upon the entire record, the Department makes the following findings:
(a) The exemption is administratively feasible;
(b) The exemption is in the interests of the plan and its participants and beneficiaries; and
(c) The exemption is protective of the rights of the participants and beneficiaries of the plan.
According to the Federal Register, The Employee Benefits Security Administration, an agency of the DOL, issued exemptions to JPMorgan Chase & Co., Deutsche Investment Management Americas Inc. (DIMA) and Certain Current and Future Asset Management Affiliates of Deutsche Bank AG, Citigroup Inc., Barclays Capital Inc., UBS Assets Management (Americas) Inc.; UBS Realty Investors LLC; UBS Hedge Fund Solutions LLC; UBS O’Connor LLC; and Certain Future Affiliates in UBS’s Asset Management and Wealth Management Americas Divisions.
For years, these same institutions have been caught illegally manipulating markets (LIBOR, Gold, Currencies), yet instead of shutting them down, the various agencies imposing fines (not jail sentences) have been tremendously enriched.
For example, the DOL “notes the size of relevant fines imposed by various regulators: The Department of Justice imposed a $550 million fine; The Board of Governors of the Federal Reserve Board imposed a $342 million fine; and the OCC, the Commodity Futures Trading Commission, and the FCA imposed fines of $350 million, $310 million, and £222,166,000, respectively.” And, that’s just JPMorgan Chase and its affiliates. Each entity has been similarly fined.
As a refresher, gross negligence, mismanagement, and loose lending practices by these institutions led to the 2007-2009 financial crisis. Instead of allowing them to reap the free-market reward of failure, however, they were bailed out. The reason? The impact to consumers would be far too great.
Regulators may tout the billions received in settlements due to the banksters’ pre-and-post-crisis activities, but the fines have not curtailed their abuses. Instead, the lack of true accountability only seems to embolden them.
Now, we see the same repeat offenders being protected again because the potential impact to the investors would be too great. The too big to fail are again proven too big to jail.