There is no question the media would have pilloried Rudy Giuliani if he ever conducted a prosecution of an African American community bank in manner District Attorney Cyrus Vance, Jr.’s office treated Abacus Federal Savings Bank. Of course, Vance is a Democrat and Abacus serves the residents of Chinatown, so the media can’t be bothered. However, documentarian Steve James delivers a stinging indictment of an unjust prosecution/persecution in Abacus: Small Enough to Jail (trailer here), which opens this Friday in New York.
Founded by Thomas Sung to serve the financial needs of the Chinatown community, Abacus was an American success story. It remains a family business managed by the Sungs’ grown daughters. Their only real mistake was hiring the duplicitous Ken Yu, who secretly solicited bribes and exploited his managers’ ignorance of his Chinese name to falsify loan documentation. When Abacus learned of his malfeasance, they summarily fired him and voluntarily notified regulators of his activities. For their efforts, they were indicted by Vance office, who literally paraded them in front of the media in chain gang-style leg irons. Just who was Vance’s star witness? The demonstrably perjurious Ken Yu, naturally enough.
Over the course of the 19-week trial, so many of the prosecution’s witnesses were so easily exposed in contradictions, the defense actually started to worry the jury might start to think Abacus was doing business in a milieu of lies. We hear the jaw-dropping audio accompanying some surprisingly expressive courtroom artists’ renderings—and the implications are inescapable.
There was no intent on the part of Abacus to defraud the government. There was no harm done, because the resulting loans they sold to Fannie Mae continued to perform. However, Vance and his prosecutors wanted to make an example of someone, so they chose Abacus, assuming they would not fight back. Unfortunately, that made life rather awkward for the Sung’s youngest daughter Chanterelle, who was an Assistant DA in the Vance office at the time of the indictment.
Small Enough to Jail is a shocking expose of prosecutorial abuse and a rousing David vs. Goliath story. Yet, some critics seem to be a bit lukewarm on it, because they want some grand statement on the financial crisis of 2008. Yes, the big banks were never charged with anything, which is hypocrisy, but believe it or not, most movie critics do not fully understand the circumstances that contributed to the crisis over the long-term. In 1995, regulators started applying the Community Reinvestment Act more vigorously, mandating banks take a more “innovative and flexible” approach to low and middle income (LMI) credit-seekers. The big banks were indeed innovative and flexible, assuming they would be better off facing the music for financial irregularities than for discriminatory practices—and the slap on the wrist they received proved them right. It is unfortunate James does not make this point, because it is actually exculpatory for Abacus. They did not need to chase sub-prime business, because they were already primarily serving LMI loan-seekers.
In all other respects, Small Enough to Jail is a sterling example of muck-raking. Watching the case brought by the Vance office crater into a puddle of lies will make your blood boil. Conversely, the dignity and perseverance of the Sung family and their employees is inspiring. They prove you can still get justice when you are targeted by a glory-hunting DA, if you are willing to spend ten million dollars. James duly gives Vance and his chief economic crimes prosecutor Polly Greenberg a chance to have their say (the dissembling is embarrassing to behold).