In May 2009, in the wake of the “Great Recession,” President Obama signed into law the Fraud Enforcement and Recovery Act, which established the Financial Crisis Inquiry Commission.  According to the FCIC’s website, the Commission was created to “examine the causes, domestic and global, of the current financial and economic crisis in the United States.”  To that end, the FCIC was charged with examining fraud and abuse in the financial sector, the efficacy of federal and state financial regulators, and the structure of legal and regulatory schemes in the financial sector. 

In a Fact Sheet presented at the First Public Hearing of the FCIC on January 13-14, 2010, the Commission highlighted numerous financial fraud cases undertaken by the DOJ and SEC.  At the time, the DOJ was pursuing some 500 mortgage fraud related charges, with 2,700 additional investigations pending.  Meanwhile, the SEC was engaged in 664 enforcement actions. 

And it looks like the financial fraud business will continue to boom for the Feds. According to Sewell Chan of the NY Times, the FCIC recently made a number of referrals to the Justice Department “as a precaution to ensure that federal authorities were aware of potential misconduct the panel came across during its yearlong investigation.”  Most of the referrals involve possible violations of federal securities laws and, according to a source who spoke to the Huffington Post under condition of anonymity, civil investigation will be the most likely outcome of the referrals. 

The FCIC recently announced  that it will release its full report on the causes of the financial crisis on Thursday, January 27th, and Mr. Chan of the NY Times tells us it “will probably reignite debate over the outsize influence of Wall Street; it says that regulators ‘lacked the political will’ to scrutinize and hold accountable the institutions they were supposed to oversee.”

Like the 9/11 Report, the 567-page FCIC report, which includes “dissents” from Republican members of the Commission, will undoubtedly become a best seller.  And while it may not be as popular a read among the “alphabet soup of regulatory agencies” blamed for the 2008 financial crisis, it will be interesting to see the DOJ and SEC response.