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Jenner & Block Partner Neil M. Barofsky is featured in the award-winning documentary Abacus: Small Enough to Jail. The documentary tells the story of the Chinese immigrant Sung family, owners of Abacus Federal Savings of Chinatown, New York. The bank was accused of mortgage fraud by the Manhattan District Attorney Office, becoming the only US bank to face criminal charges during the 2008 financial crisis. The film argues that the prosecution of the small, community bank was a waste of resources and that any fraud at Abacus was relatively low level. “There are a certain number of people who commit the crime of mortgage fraud because they lie on their application to get a loan for the home that they want to live in,” Mr. Barofsky explains. “Is it technically a crime? Absolutely. Is it a crime that is worth the resources of a state or federal government? Absolutely not.” The documentary also explores why the district attorney’s office may have indicted the family-owned bank instead of going after “too-big-to-fail” banks. “There was this notion that we couldn’t bring criminal action against them [the bigger banks] because the collateral consequences of an institution that was so large, so internationally connected, that indicting them or bringing criminal charges against them could wreck the entire financial system,” Mr. Barofsky said.
Before joining the firm, Mr. Barofsky spent eight years as a prosecutor in the US Attorney’s Office for the Southern District of New York. There, he served in the Securities and Commodities Fraud Unit and later founded and led the office’s Mortgage Fraud Group as Senior Trial Counsel. He was later appointed by the President to become the first special inspector general for the Troubled Asset Relief Program.
Released in 2016 and recently broadcast on PBS’ Frontline, the documentary earned the 2017 Critics’ Choice Awards for “Best Political Documentary.” The Academy of Motion Pictures and Sciences also announced Abacus as one of 15 films advancing in the voting process for the 90th Academy Awards in the “Documentary Feature” category.