Criminal charges against banks risk sparking crisis

As U.S. Justice Department prosecutors angle to bring the first criminal charges against global banks since the financial crisis, they'll have to stare down warnings of uncontainable collateral damage. The 2002 collapse of Arthur Andersen, the accounting firm indicted in the Enron scandal, "should be a lesson" for prosecutors, Brad Hintz, an analyst at Sanford C. Bernstein & Co., said today in an interview on Bloomberg Television. Stung by lawmakers' criticism that multibillion-dollar settlements have done too little to punish Wall Street in the wake of the financial crisis, prosecutors are considering indictments in probes of Credit Suisse Group AG and BNP Paribas SA, a person familiar with the matter said. Even after talking with financial regulators about ways to mitigate damage -- such as ensuring banks keep charters -- prosecutors might not fully understand consequences for the market, according to industry lawyers and bankers who are following the case.

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