Fed to big banks: Clean up your act or you're done

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Fed warns big banks on culture, ethics

The mood may have been polite and diplomatic, but the message was not.

At an otherwise docile gathering Monday, New York Fed President William Dudley and Fed Gov. Daniel Tarullo delivered a message to high-ranking Wall Street executives that bad behavior won't be tolerated. Dudley in particular said big financial institutions operate under a cloud of suspicion and have continued bad behavior even after suffering more than $100 billion in fines and triggering a multitrillion-dollar bailout after the financial crisis.

"As a consequence, the financial industry has largely lost the public trust," Dudley said, according to remarks released by the New York Fed.

A number of big Wall Street names attended the closed-door session, as reported by the Wall Street Journal. Among those in attendance were Morgan Stanley CEO James Gorman, JPMorgan Chase general counsel Stephen Cutler and executives from Goldman Sachs and Credit Suisse.