It's been seven years since the mortgage melt-down and not one bank or banker has been prosecuted criminally for the fraud that took place. PBS's Frontline aired a special on January 22, 2013 titled "The Untouchables" that looked into this issue in some detail. The program was a scathing indictment of the Government's prosecutorial efforts in bringing the big banks and bankers to justice.

At a Senate Banking Committee hearing on March 6, 2013, Attorney General Holder said: "I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy. I think that is a function of the fact that some of these institutions have become too large."

The primary Congressional response to the mortgage meltdown that began in 2007 and financial crisis that followed in 2008 was the Dodd–Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) that was signed into law on July 21, 2010. The American Bankers Association (ABA) issued a report in 2012 on the impacts Dodd-Frank was having or might have on community banks. Among other things, it indicated that "Some banks will evaluate whether to continue to make mortgages, because these changes will require burdensome implementation efforts and increased regulatory guidance from federal agencies."

In fact, the banker that referred me to this report indicated that his community bank had stopped making mortgage loans because of Dodd-Frank. Other small banks are shifting their charters away from federal charters and supervision by the Office of the Comptroller. As one banker put it, "We've had two foreclosures in the last four years, and yet here we had to do it anyway because our regulator only knows how to deal with the behemoth banks."

In essence, Dodd-Frank was passed in response to bad behavior by large banks and other large financial institutions but small banks have become the innocent victims of its regulatory burden.

Is it time to break up the big banks and ease regulations on small banks? The Supreme Court broke up the Standard Oil Trust in 1911 into 33 smaller companies. Congress passed the Airline Deregulation Act of 1978. The U.S. Justice Department was responsible for the breakup of AT&T and the Bell System in 1982. Each of these actions spurred increased competition and was beneficial for consumers, small businesses, small business employees, and the economy.

As was shown in the financial collapse of 2008, the FDIC is equipped to handle the failure of small banks but institutions like Citi, Chase, Wells Fargo, and Bank of America are too big to fail. It's also apparent that they are too big to jail. Attempts to regulate the banking industry are having a negative impact on the banks whose failure poses the least risk to our economy.

A largely deregulated banking industry without behemoths like Citi, Chase, Wells Fargo, and Bank of America might be just the shot in the arm that our banking industry and consumers need.