Recapping the day's news and newsmakers through the lens of CNBC.
From time to time, anyone running a business trembles when reminded of legal implications if something goes wrong, especially when forgotten laws can be brought back from the dead to make a recent case stick.
Last week's fraud verdict against Bank of America shows how prosecutors have found inventive ways to ratchet up the consequences. In effect, the U.S. Attorney's Office in Manhattan used a nearly dormant law, The Financial Institutions Reform, Recovery and Enforcement Act of 1989, to make a criminal case without the usual burden of establishing proof beyond a reasonable doubt. It was the first time this innovative approach was taken all the way though to a trial. The law, passed after the S&L crisis, allows the Justice Department to sue for alleged fraud involving federally insured financial institutions, and it has a 10-year statute of limitations, double the standard period.
"This is the genie that is never going back in the bottle."—Brian Feldman of the law firm Harter Secrest & Emery
"It allows ... the government to go after all kinds of malfeasance that some people thought that maybe you couldn't go after before."—U.S. Attorney Preet Bharara, whose office brought the case against Bank of America