After serving six years as the head of the U.S. Department of Justice (DOJ), Attorney General Eric H. Holder Jr. on Sept. 25 announced his resignation.
Holder made history as the first African-American named to the post. However, he has long signaled his plans to leave the job by the end of this year, and DOJ officials have said Holder and President Barack Obama have had “several discussions” about his planned departure, and finalized those plans at a White House meeting over the Labor Day holiday.
Just last month, Holder and Associate Attorney General Tony West announced a $16.65-billion settlement with Bank of America Corp. (BOA) — the largest civil settlement with a single entity in American history — to resolve federal and state claims against the company and its former and current subsidiaries, including Countrywide Financial Corp. and Merrill Lynch. The settlement was part of ongoing activities by Obama’s Financial Fraud Enforcement Task Force and its Residential Mortgage-Backed Securities (RMBS) Working Group, which has recovered $36.65 billion to date for American consumers and investors. BOA also agreed to pay a $5 billion penalty under the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) — the largest FIRREA penalty ever.
In July, Holder announced a $7-billion settlement with Citigroup Inc. — including a record $4-billion civil penalty — to resolve federal and state claims related to the bank’s conduct in the packaging, securitization, marketing, sale and issuance of residential mortgage-backed securities in the lead-up to the financial crisis.
And in June, Holder announced that the DOJ, Department of Housing and Urban Development and the Consumer Financial Protection Bureau, along with 49 state attorneys general and the District of Columbia’s attorney general, reached a $968 million agreement with SunTrust Mortgage Inc. to address mortgage origination, servicing and foreclosure abuses.
However, Holder came under fire earlier this year, when Sen. Elizabeth Warren (D-Mass.) suggested that relying on settlement agreements and consent orders to enforce possible violations may not be sufficient.
“There is no question that settlements, fines, consent orders and cease and desist orders are important enforcement tools, and that trials are expensive, demand numerous resources, and are often less preferable than settlements,” Warren wrote in a May 14 letter to Holder, Federal Reserve Board Chairman Ben Bernanke and Securities and Exchange Commission Chairman Mary Jo White. “But I believe strongly that if a regulator reveals itself to be unwilling to take large financial institutions all the way to trial — either because it is too timid or because it lacks resources — the regulator has a lot less leverage in settlement negotiations and will be forced to settle on terms that are much more favorable to the wrongdoers.”
Holder will remain at the DOJ until a successor is chosen. The New York Times speculated that possible successors include former White House counsel Kathryn Ruemmler; Solicitor General Donald Verrilli, who represented the government in the recent Hobby Lobby Supreme Court case; and Manhattan U.S. Attorney Preet Bharara.
Holder was sworn in as the 82nd Attorney General of the United States on Feb. 3, 2009 by Vice President Joe Biden. He previously was named Deputy Attorney General in 1997 by President Bill Clinton, and was the first African-American named to that post. Prior to that, Holder served as U.S. Attorney and Associate Judge of the Superior Court of the District of Columbia in Washington, D.C. He was also previously a litigation partner at the law firm of Covington & Burling LLP in Washington.