The financial industry lobbied and got laws that permitted them to do the things that they did during the bubble. They didn’t break any laws because they spent a lot of time and money getting the laws changed for their own benefit.
They got rid of the last vestiges of the Glass Steagall Act which had kept investment banks out of the retail lending field for 70 years. They got the CFMA2000 passed which exempted derivatives from being regulated or even reported. They turned the derivatives market, including the swaps market, into a virtual casino.
Anyone who believes that this crisis was solely the result of government meddling is too ignorant of the facts to warrant consideration. The causes include the two laws mentioned above, the transition away from lenders having a stake in the loans they write, to David X Li’s Gaussian Copula Function, to the Magnetar hedge fund gaming the creation of CDOs. And more.
AS I suspected. They didn’t break any laws.