05/30/2012 09:53 am ET Updated Jul 30, 2012

The Final Straw: Break Up the Banks

It's a nice, quiet Memorial Day weekend. Kids frolic on the beach, friends barbecue in backyards, and the Securities and Exchange Commission decides to announce it's tip-toeing away from the biggest corporate bankruptcy scandal in U.S. history, without prosecuting a soul.

One question that arises, is, perhaps the SEC picked Memorial Day weekend to drop its case against Lehman Brothers -- the corporate collapse which sent the world financial markets into utter chaos, the likes of which we are still smack in the midst of -- with the hopes no one would notice?

The other is, "WHAT THE F&@@##$$%&*K?????!!!!!!!!"

How on earth is it possible for the watchdog of the finance world to be given everything it needs in a nice, little package, e.g., pages upon pages of evidence that, according to investigators, clearly reveal illegal accounting practices, breach of fiduciary duties, repeated illegal shifting of funds, stock fraud, written testimony from Lehman's top accountant, confessions from subordinates, etc., and then just toss that package in the garbage?!! It's absolutely mind-boggling. Do they honestly expect us to believe they found no wrongdoing of any kind? Especially when you consider, just a month prior, 60 Minutes, that 'wishy-washy' and 'semi-credible' news source, aired the lone interview with Lehman lead investigator, Anton Vakulas, who was only appointed by the Federal Bankruptcy Court, and who, after reviewing over 30 million documents, only stated, point blank, "They fudged the numbers."

Forget about the fact, Ernst&Young, Lehman's accounting firm, helped cover it up. Forget about the fact the SEC actually had offices inside Lehman's headquarters while this was going on. Forget about the fact that Lehman's head accountant of 14 years, Matthew Lee, refused to sign off on quarterly reports and submitted his concerns in writing, then was subsequently fired. And, forget about the fact that 26,000 people lost their jobs. At the very least, this latest example of financial Three-card Monte being played on the American people should provide even the most prudent skeptics with more than enough evidence to wholeheartedly support Occupy Wall Street's "Economic Conspiracy" theory.

There are no more excuses left to justify letting these financial cannibals off the hook any longer. Thus, it's time to "clean house." And, the first thing to do is to shake up the SEC. If they can't/won't do anything, the only proper move at this point, -- and, it's just a start -- is to call for Chairman Mary Schapiro's immediate resignation. If this woman was your babysitter, and you set the house on fire, and stood there holding matches and covered in gasoline, she would probably blame a loose wire. It's yet another betrayal in a never-ending list of regulators who were entrusted to go after those responsible for the mess we're now all knee-deep in.

If the SEC had trouble deciding whether or not there was any funny business going on, they might've done well to consult Charles Ferguson, Oscar-winning director of Inside Job -- the documentary that chronicles the collapse of the world financial markets. Mr. Ferguson presents quite a compelling argument, not only with regard to Lehman Brothers, but also calling the president to task for, amongst other things, assigning a staff of only fifteen, to work the entire Wall Street corruption case. A recent article at highlights other interesting points, e.g., the meager 10-million dollar budget, only 10 FBI agents on the case out of a pool of 14,000, etc. Isn't it wonderful Congress can approve a few billion here or there to drop a few more bombs somewhere, yet, we're left with almost nothing when it comes to investigating the largest financial corruption scandal of our generation?

The next, and, probably most important, thing we could do is take a page out of Sen. Bernie Sanders' book and demand that Congress "break up the banks," just like they did the phone company.

A few fun facts from the esteemed senator from Vermont -- the originator of the "Break Up the Banks" philosophy:

-- The nation's six biggest banks have assets equivalent to two-thirds of the nation's GDP
-- These six banks control 52 percent of all industry assets, compared with 17 percent just over two decades ago
-- They control half of all the mortgages in the country
-- They hold two-thirds of the nation's credit debt

Take the facts above, add the resulting financial crisis, the SEC asleep at the wheel -- again, the recent 2-billion dollar "Vegas Trip" by J.P. Morgan, the revelation that Morgan's CEO, Jamie Dimon, sits on the board of the FED -- a clear conflict of interest, and it proves the senator's case for him. If this isn't antitrust, what is?

Last week, New York Times writer, Simon Johnson, started a petition to call for the resignation of Mr. Dimon or the removal of his seat on the N.Y. Fed. The petition has already gathered over 30,000 signatures, but, it's just a start.

If we're going to put a stop to the mudslide of money that's at the root of all of this, the best way to do it is to widen the playing field. Breaking up the monopoly these giant institutions currently enjoy, will not only create more competition, it also may prevent a mess like this from happening to future generations. Don't hold your breath, though.

Sadly, since the collapse, it seems Wall Street has gotten even more powerful, because the banks know, no one in government wants to risk disrupting the already wobbly financial markets, again. Not to mention, the money that must be changing hands is off the charts. And, where is our president in all of this? To this day, not a single financial executive has been charged with any wrong doing, yet we're almost three years deep into congressional hearings on steroid use in baseball.

Sadly, since the collapse, it seems Wall Street has gotten even more powerful, because the banks know, no one in government wants to risk upsetting the apple cart, again. Breaking up the banks might not be the answer to the "Economic Utopia" we all dream of, but, after the events of the past five years, could it get any worse?