Professor William Black:

That is a superb question, not just a good question.

At the moment of our greatest success in 1993 - there is this period that basically ended in 1993 - a new government came in. It brought with it, as its primary domestic priority involving government, the re-invention of government which is, essentially, principles-based regulation. They absolutely adored the lessons of the savings and loan crisis. I personally witnessed the following. We were instructed that we were to refer to the banks as our "customers". I said, "Surely you mean the people of the United States of America?". They said, "No, the banks." I left government at this point, as you would imagine.

I do not say it was a conspiracy, but it was a deliberate choice to move to a very different strategy without looking at the successes of the response to the savings and loan debacle. In order to produce over 1,000 felony convictions, we created a criminal referral process that provided the key information from the regulators. I remind the committee that we have vastly more expertise in the industry on accounting issues, etc., than the FBI white-collar folks. We made over 30,000 criminal referrals. That criminal referral process was eliminated. In the current crisis, there were no criminal referrals in the United States, as far as anyone can tell.