On May 20, five of the biggest banks in the world pleaded guilty to charges of interest rate manipulation and agreed to pay $2.8 billion in fines for the felonies they committed. Two of the banks, J.P. Morgan Chase and Citigroup, are U.S.-based. Each has a long rap sheet of recent settlements for their corporate misdeeds, and each has paid large fines and settlements -- nearly $35 billion in the case of JP Morgan Chase. But otherwise, these businesses go on with no reduction of rights or privileges and with no decision makers being sent to prison.

A criminal double standard: individuals go to jail for illegal acts, but corporations get probation and business as usual.

In the United States, when individuals are convicted of felonies, they lose many rights and are often jailed. Forty-eight states ban felons from voting while they are in prison, and 11 states may ban felons from voting for the rest of their lives, depending on the nature of their crimes. Convicted felons also have a hard time getting jobs, particularly in occupations requiring high levels of trust - like banking.



Federal Deposit Insurance Corporation (FDIC) regulations explicitly bar banks the agency insures from hiring or associating with "any person who has been convicted of any criminal offense involving dishonesty or breach of trust or money laundering, or has agreed to enter a pre-trial diversion or similar program in connection with a prosecution for such offense."

So, if you commit fraud by writing a bad check and get convicted, a bank can't hire you, but if you are a bank and have committed fraud on a massive scale, the FDIC will continue to insure your deposits.

While some bank lawyers were sitting across the table from Justice Department attorneys hashing out the details of last month's plea deal and settlements, other bank employees and contractors were busy lobbying the Securities and Exchange Commission (SEC) and the U.S. Department of Labor for waivers to allow them continued access to special perks and privileges. Even after their organizations were found to have deliberately manipulated financial rules, they argued for expedited review of corporate stock offerings and the ability to continue to manage pension funds.

Without these waivers, banking operations would be hampered, so SEC Chair Mary Jo White, accused of slowing down disclosure rules on CEO-to-worker-pay and the establishment of better oversight of financial institutions, quickly waved the waivers through, clearing the way for the settlement.

Big banks are notorious repeat offenders. Clearly, fines are just a cost of doing business. So how about some real deterrents?

Twenty-eight states have "three strikes and you're out" rules for individual people who are repeat offenders. If you commit three felonies, which can be as inconsequential as shoplifting more than $50 worth of merchandise three times, you can be sentenced to mandatory, decades-long prison terms or even life in prison if the crimes are serious enough.

But if you're a bank manager, your institution can commit massive offense after massive offense, bilk Americans out of billions of dollars, and you won't go to jail. Indeed, your institution may not even lose privileges that are -- or should be -- only available to law-abiding corporations. As just one example, see JP Morgan Chase's rap sheet below.

Date Offense Agency Involved Admit Wrongdoing Financial Settlement June 2011 Misleading investors on collateralized debt obligations SEC No $153.6 million July 2011 Depriving municipalities of competitive process when they issue bonds Justice Department Yes $228 million Feb. 2012 Foreclosure abuse Justice Department and 49 state attorneys general No $5.29 billion Nov. 2012 Misstating delinquency status of mortgages SEC No $269.9 million Jan. 2013 Additional foreclosure settlement Justice Department and 49 state attorneys general No $1.8 billion July 2013 Electricity price manipulation Federal Energy Regulatory Commission (FERC) No $410 million Sept. 2013 Illegal credit card practices Consumer Financial Protection Bureau (CFPB) No $389 million Sept. 2013 Failure to supervise employees - London Whale SEC Yes $920 million Oct. 2013 Violations that harmed Fannie Mae and Freddie Mac Federal Housing Finance Agency No $5.1 billion Nov. 2013 Selling bad mortgages to intuitional investors 21 institutional investors N/A $4.5 billion Nov. 2013 Selling "toxic mortgages" Department of Justice Yes $13 billion Dec. 2013 LIBOR interest rate rigging European Union Yes $108 million Jan. 2014 Role in Madoff Ponzi scheme Department of Justice Yes $1.7 billion Nov. 2014 Currency manipulation Commodity Futures Trading Commission / Office of the Comptroller of the Currency No $1.34 billion May 2015 Interest rate manipulation Department of Justice Yes $550 million TOTAL $34.8 billion

Although last month's Department of Justice announcement represents a welcome departure from its past practices of settling corporate crimes without demanding an admission of guilt, in recent years, government lawyers have typically entered "deferred prosecution agreements" with violating corporations. These agreements represent a sort of "parole before conviction"; if corporations behave and don't break that particular law again over a set period of time, the criminal charges against them are forgiven.

Deferred prosecution agreements have long been used with individuals, extending them to corporate crimes was the brainchild of former Attorney General Eric Holder when he was an Assistant Attorney General in the Clinton administration.

They have been wildly unsuccessful in changing the behavior of powerful Wall Street banks. In fact, several banks have multiple deferred prosecution agreements in place, each for a different offense. Imagine a prosecutor saying to a thrice-convicted felon in a "three strikes and you're out" state, "Well, one of your crimes was for shoplifting, another for drug possession, and a third for assault. You haven't committed the same offense more than once, so we're good."

The deference shown by U.S. prosecutors toward banking executives in the 2008 lending crisis that caused the Great Recession is in stark contrast to what happened during an earlier period of fraud among financial institutions: the savings and loan crisis of the 1980s. That crisis, which involved massive commercial real estate fraud, was only one-seventh the size of the 2008 bank crisis. But it cost U.S. taxpayers more than $130 billion in bailout funds and resulted in the closure of nearly one-third of the savings and loan industry.

In that crisis, savings and loan regulators made over 300,000 criminal referrals that resulted in over 1,000 major felony convictions. The regulators worked with the FBI and Department of Justice to create a list of the 100 worst fraud schemes, involving 300 savings and loan institutions and 600 individuals. All of those 600 people were prosecuted and 90 percent were convicted. Of the 2,300 FBI agents working on white collar crime at that time, 1,000 of them were working on savings and loan industry cases. Hundreds of people served jail time, including an 11-year sentence for Charles Keating, who was at the center of the corruption scandal.

In the financial crisis of 2008, the same regulatory agency made no criminal referrals against of the hundreds of thousands of fraudulent mortgage loans that were made; the office that regulates the largest national banks leveled no criminal allegations, nor did the Federal Reserve. In spite of the fact that the FBI had warned of "an epidemic of mortgage fraud" in 2004 and predicted a financial crisis unless it was stopped, only 120 FBI agents were assigned to work on mortgage fraud in 2007 when things started falling apart. There was no national task force, and the cases that were brought failed to focus on the largest institutions producing "liars loans" and other fraudulent products.

The resulting meltdown immediately cost more than 8 million Americans their jobs. Over 16 million foreclosure notices have been filed since 2007, according to Reality Trac. Despite the financial devastation borne by American families, only one high-level banker - Credit Suisse executive Kareem Serageldin - has been criminally charged and sent to jail.

Even more telling: CEOs leading the banks that blew up the financial sector and stole the wealth of middle-class families have not only stayed in their jobs, some have also enjoyed huge pay increases - while their companies are paying large fines and settlements for the criminal activity over which the CEO presided. What kind of a message is this sending?

Deterring future white collar criminal activity means prosecutors and Congress have to get serious about corporate crime.

How can we change illegal but profitable behaviors and reduce corporate crime?

Enforce federal and state rules banning corporate felons from doing business with any public entity. Lucrative taxpayer-funded contracts should go to businesses that respect the law and don't defraud taxpayers and consumers.

Ban corporate felons from political participation: restrict them from spending any money on lobbying, from supporting any 501(c)(3) or 501(c)(4) organizations that attempt to influence policy, and prohibit their officers and executives from making campaign finance gifts for a number of years, just as we ban other felons from voting. Over the last five years, JP Morgan Chase and Citigroup have spent $34.8 million and $26.9 million lobbying Congress, respectively. And each has spent more lobbying the Securities and Exchange Commission and the Consumer Financial Protection Bureau in an attempt to delay pro-consumer rulemaking. While corporations are barred from donating directly to candidates or party committees, they can and do contribute to political action committees. There are over 1,000 corporate-related PACs. Moreover, highly paid employees of corporations may "bundle" individual contributions to support candidates that share their values.

Curtail the Securities and Exchange Commission's power to grant waivers to protect corporate repeat offenders. There are good reasons why the FDIC and SEC both bar felons from employment in the industries they regulate. Why should they continue to grant special privileges to the corporations guilty of repeated violations of the public trust?

Establish "capital" punishment for persistent serious multiple offenders. Three strikes and your banking license is gone.

This article first appeared in the Huffington Post