"You can't have some institutions that are protected by the law, not allowed to fail and not held to account, and all the other institutions and companies in America are allowed to fail," he said.
"You can't have equal justice under law and have too big to fail," he continued. "And that's where we were stepping up this week." He added, "We're not taking equal justice under law back anywhere. That's American, that is quintessentially American, and that's what we're stepping up on. Everything is on the table."
When asked about criminal prosecutions, he said, "certainly the folks who have the criminal jurisdiction are a part of our working group...again the combination of resources should tell you that we're looking at criminal liability, civil liability and an array of things I've already mentioned."
(Video above via MSNBC.)
The new unit, announced by President Barack Obama in his State of the Union address, will have the power to investigate mortgage fraud going back at least 10 years. It will consider a variety of cases, including false statements, mail and wire fraud, and failure to comply with the Financial Institutions Reform, Recovery and Enforcement Act of 1989, established in the wake of the savings and loan crisis, reported The Huffington Post's Loren Berlin.
The administration announced a different financial fraud unit three years ago, the Financial Fraud Task Force, which has gone after small-time fraud and not big-time Wall Street bankers, mostly settling for civil fines.
FireDogLake blogger David Dayen wonders about the purpose of the new unit. "Three of the five co-chairs of this panel have a history of dragging their feet on enforcement against the banks in precisely the same areas that this panel will allegedly investigate," he noted.
Robert Kuttner, while praising the decision to create the task force, said Schneiderman could face headwinds:
There are certainly those in the administration who hope to sit on Schneiderman. You can see this in the dueling press releases to date. For instance, Eric Holder, in his Friday statement, included the unhelpful comment that "behavior that is unethical or reckless may not necessarily be criminal." This is of course true, but why on earth make that point in the context of announcing a new task force that is supposed to signal new toughness? It suggests that Holder, if left in charge, would pursue the same weak prosecutorial policies of the past three years.
The announcement of the unit came just a few days before The Huffington Post's Sam Stein and Zach Carter reported that the Obama administration, state attorneys general, and possibly, the nation's largest banks, were close to a final $25 billion settlement over allegations of massive foreclosure fraud.
Attorneys general more critical of the banks, such as Schneiderman, have rejected administration overtures that they join in the settlement, calling it too weak. The creation of the crisis unit is seen as a way to persuade those attorneys general to rejoin the talks.