Rakoff Rebuke Also Highlights Judge’s Influence

June 4, 2014

Jordan A. Thomas discusses court ruling concerning government effort to “punish” big banks following the financial crisis

Regarding the Second U.S. Circuit Court of Appeals ruling, which overturned a decision by Judge Jed Rakoff that rejected a $285 million deal between Citigroup and the Securities and Exchange Commission (SEC), Jordan said, “Judge Rakoff may have lost in the court of appeals but his concerns were successful in the court of public opinion.”

He added,  “I don’t believe that legacy will change because of this decision.”

Jordan noted that it is unlikely that Congress would expand its oversight of specific SEC settlements because every case is different, but it’s a testament to Rakoff’s initial objection that admissions of guilt are on the table and more people are willing to raise questions about a deal’s fairness. He also stated that there is tension at the SEC where leaders are sensitive to the perception of justice in their settlements.