Indictments are going to be hard b/c proof of an actual crime (and not some trumped up charge like mail fraud) is going to be impossible. In the case of Fannie & Freddie, they were found guilty of breaking accounting rules and were severely punished earlier this decade. Most of the blame around their failures can actually be laid with Congress for not tightening regulations enough and restricting their mortgage holdings.
Most people, especially members of Congress, have very little understanding of why these companies and others (Bear, Merrill, Wamu) are having such problems. AIG & Lehman's failures had very little to do with illegal actions- they have something to do with poor management decisions over the past couple of years (and in some cases the past 6 months), but most of the blame can be laid on the absolute stagnation of credit markets. I'm not going to go into a lesson on why and how the markets have dried up (it would get too technical and take too long), but the simple explanation is that EVERYBODY shares some of the blame- homeowners, mortgage brokers, thrifts, investment banks, commercial banks, Congress, the Fed, the SEC, the Treasury, etc.
The ability to obtain credit to finance a business on a daily basis, which is a fundamental need for a financial services company in the same way you and I need to breath air or drink water, has almost totally dried up. If companies run out of sources of liquidity they have to sell assets which will invariably be sold at firesale prices b/c they need cash, causing the value of other similar assets in the market to drop, causing the company to need more cash, causing a ratings agency to come in and question the company's solvency and lowering their rating, causing them to need even more cash, until they have nothing left to do but throw themselves on the mercy of the system.... What I just described to you is what happened to AIG.
We don't fix the situation through jailtime, we fix the situation by re-establishing markets (don't ask me how, I'm not smart enough
) and then taking necessary steps through smart and somewhat limited regulation and oversight to make sure that next time this happens the powers that be handle it in a more orderly fashion. This may sound idealist and simplistic, but it is how the SEC, Fed, FDIC, SIPC, and many other agencies were created- as lessons learned from the bank panics of the 1800s and the great depression.
