In the wake of the financial crisis, government regulators have been widely criticized for failing to hold more individuals accountable, but a pending case by the U.S. Securities and Exchange Commission against two former executives at State Street Bank and Trust Co. shows how difficult in practice it can be to make charges stick.
On Friday, the SEC commissioners heard an appeal of an initial decision by chief administrative law judge Brenda Murray, who in 2011 ruled squarely against SEC enforcement division lawyers, dismissing the government’s case against John Flannery and James Hopkins for misleading investors.
