Andrew Ross Sorkin, a financial columnist for the New York Times recently said this:

“If there’s one question that I get just about more than any other, ‘So why didn’t anybody go to jail, and did nobody try?’ And there’s an answer to that too. A lot of people had an incentive to try to find a way to bring not justice, but to put people away. Prosecutors, law enforcement, journalists — it would have been a better story. But for the last five years we’ve tried, all of us have tried, to find that criminal element.”

To Sorkin, William Black says — found it.

Black is a former litigation director of the Federal Home Loan Bank Board — and was a central figure in bringing hundreds of savings and loans crooks to justice.

Black knows how to prosecute corporate crime.

He’s author of The Best Way to Rob a Bank is to Own One — which will be released in an updated form in January 2014.

Black is currently an associate professor of Economics and Law at the University of Missouri Kansas City.

“Sorkin is wrong about incentives and quite wonderfully wrong,” Black told Corporate Crime Reporter in an interview last week. “The Financial Crisis Inquiry Commission emphasizes that the belief in self correcting markets was prevalent throughout the regulatory agencies. They believe that fraud was impossible, because markets were self correcting. Fraud might exist for a short period of time, but it couldn’t be serious because markets were so incredibly effective in eliminating fraud. If it was here today, it would be gone tomorrow.”

But prosecutors don’t think in economic terms. If you ask SEC enforcement officials or federal prosecutors about what you just said, that would be totally foreign to them. They think in terms of the facts and the law, don’t they?

“It’s important to understand that what you have just said is not accurate. I can tell you that at a deep level, this is absolutely critical to how they think. And this is throughout the regulatory agencies and it is handed down through their economists.”

“For example, it was long the dominant view at the SEC. And there is stuff throughout the Financial Crisis Inquiry Commission report about how it was dominant throughout the Federal Reserve Board and how it crushed efforts to supervise. It’s not just some kind of academic curiosity that doesn’t exist at the pointy end of the spear. It makes sure that the pointy end of the spear ain’t there.”

“Let’s look at reporters like Sorkin. His incentive structure is actually opposite of what he said. His incentive structure is to have access, to be able to eat lunch with Jamie Dimon. And if Sorkin were the kind of reporter who asked questions, he would not have that access.”

Black doesn’t buy the argument that Attorney General Eric Holder’s and former head of the Criminal Division Lanny Breuer’s ties to big bank law firm Covington & Burling had much to do with their failure to prosecute big bank executives.

“This is where I think we differ,” Black said. “There has been a focus on Eric Holder and Lanny Breuer because of the firm they came from — Covington. But I don’t think that because they come from a firm that represents big banks is sufficient.”

“The chief counsel of OTS when I was there was Harris Weinstein. He came from the same firm. And he’s the one who turned things around, unleashed us, produced these record number of enforcement actions, referrals and prosecutions.”

And just because Neil Barofsky is going to Jenner & Block doesn’t mean he’s a bad guy?

“It doesn’t mean he’s a bad guy,” Black said. “But it does mean we’re going to lose his voice. Once they go back, that is a different issue. They are lost as a constructive force. And we have so few of the constructive forces. And that’s a huge problem for reforming things.”

“My point is a different one. Harris Weinstein was considered insane by the bar. And he was the from the same Washington firm as Lanny Breuer and Eric Holder.”

“He was brought in by Tim Ryan when Bush appointed Tim Ryan to replace a guy we got to resign — M. Danny Wall. Bush gave the instructions that we are going to draw a line under this crisis. And it ain’t going to be my crisis. It’s going to be the crisis I inherited. And so you are going to go out — Tim Ryan — and show that there is a new sheriff in town.”

“Ryan hired as his guy someone he knew to be a skilled and aggressive litigator — Harris Weinstein.”

Who is the Harris Weinstein on the federal scene right now?

“There isn’t one,” Black said. “There is no one close to a Harris Weinstein.”

Given the public rage over this, why hasn’t the government changed — why haven’t they hired the new Harris Weinstein?

“They are not being forced to,” Black said. “It’s a chicken and egg question. We faced enormous resistance in the savings and loan debacle to get our cases prosecuted. We just kept on making superb criminal referrals. And we kept on meeting with our counterparts in the FBI and Justice Department. And we kept on pushing. And we kept on meeting with the media. And we said — this is happening because of elite crimes. Here are the analytics on why it’s happening. Here are the numbers.”

“Huge political pressure began with the media that talked about the backlog of criminal referrals and how it was growing by the thousands every quarter. And the Justice Department finally responded by creating the top 100 list. It created the top 100 list in substantial part for political reasons because of the intense criticism — virtually every week a new story about the Justice Department’s failure to prosecute. And we would say — damn right this is fraud, it’s elite fraud, and it isn’t peripheral, it is the reason that there is a crisis.”

(For the complete q/a format transcript with William Black, see 27 Corporate Crime Reporter 38(12),  October 7, 2013, print edition only.)