Best of the Week
Most Popular
1. Will Gold Price Breakout? 3 Things to Watch… - Jordan_Roy_Byrne
2.China Invades Saudi Oil Realm: PetroDollar Kill - Jim_Willie_CB
3.Bitcoin Price Trend Forecast, Paypal FUD Fake Cryptocurrency Warning - Nadeem_Walayat
4.The Stock Market Trend is Your Friend ’til the Very End - Rambus_Chartology
5.This Isn’t Your Grandfather’s (1960s) Inflation Scare - F_F_Wiley
6.GDX Gold Mining Stocks Fundamentals - Zeal_LLC
7.US Housing Real Estate Market and Banking Pressures Are Building - Chris_Vermeulen
8.Return of Stock Market Volatility Amidst Political Chaos and Uncertain Economy - Buildadv
9.Can Bitcoin Price Rally Continue After Paypal Fake FUD Attack? - Nadeem_Walayat
10.Warning Economic Implosion on the Horizon - Chris_Vermeulen
Last 7 days
Fox in the Henhouse: Why Interest Rates Are Rising - 23rd Apr 18
Stocks and Bonds, This is Not a Market - 23rd Apr 18
Happy Anniversary Silver Investors! - 23rd Apr 18
The Hottest Commodity Play In 2018 - 23rd Apr 18
Stock Market Correction Turns Consolidation - 23rd Apr 18
Silver Squeeze, Gold Fails & GDX Breadth - 23rd Apr 18
US Economy Is Cooked, the Growth Cycle has Peaked - 23rd Apr 18
Inflation, With a Shelf Life - 23rd Apr 18 - Gary_Tanashian
Stock Market Predictive Modeling Is Calling For A Continued Rally - 22nd Apr 18
SWEATCOIN - Get PAID to WALK! Incentive to Burn Fat and Lose Weight - Review - 22nd Apr 18
Sheffield Local Elections 2018 Forecast Results - 22nd Apr 18
How Long Does it take for a 10%+ Stock Market Correction to Make New Highs - 21st Apr 18
Sheffield Ruling Labour Party Could Lose 10 Council Seats at May Local Elections - 21st Apr 18
Crude Oil Price Trend Forecast - Saudi Arabia $80 ARAMCO Stock IPO Target - 21st Apr 18
Gold Price Nearing Bull Market Breakout, Stocks to Follow - 20th Apr 18
What’s Bitcoin Really Worth? - 20th Apr 18
Stock Market May "Let Go" - 20th Apr 18
Overwhelming Evidence Against Near Stock Market Grand Supercycle Top - 20th Apr 18
Crude Oil Price Trend Forecast - Saudi's Want $100 for ARAMCO Stock IPO - 20th Apr 18
The Incredible Silver Trade – What You Need to Know - 20th Apr 18
Is War "Hell" for the Stock Market? - 19th Apr 18
Palladium Bullion Surges 17% In 9 Days On Russian Supply Concerns - 19th Apr 18
Breadth Study Suggests that Stock Market Bottom is Already In - 19th Apr 18
Allegory Regarding Investment Decisions Made On Basis Of Government’s Income Statement, Balance Sheet - 19th Apr 18
Gold – A Unique Repeat of the 2007 and How to Profit - 19th Apr 18
Abbeydale Park Rise Cherry Tree's in Blossom - Sheffield Street Tree Protests - 19th Apr 18
The Stock Market “Turn of the Month Effect” Exists in 11 of 11 Countries - 18th Apr 18
Winter is Coming - Coming Storms Will Bring Out the Best and Worst in Humanity - 18th Apr 18
What Does it Take to Create Living Wage Jobs? - 18th Apr 18
Gold and Silver Buy Signals - 18th Apr 18
WINTER IS COMING - The Ongoing Fourth Turning Crisis Part2 - 18th Apr 18
A Stock Market Rally on Low Volume is NOT Bearish - 17th Apr 18
Three Gold Charts, One Big Gold Stocks Opportunity - 17th Apr 18
Crude Oil Price As Bullish as it Seems? - 17th Apr 18
A Good Time to Buy Facebook? - 17th Apr 18
THE Financial Crisis Acronym of 2008 is Sounding Another Alarm - 16th Apr 18
Bombs, Missiles and War – What to Expect Next from the Stock Market - 16th Apr 18
Global Debt Bubble Hits New All Time High – One Quadrillion Reasons To Buy Gold - 16th Apr 18
Will Bitcoin Ever Recover? - 16th Apr 18
Stock Market Futures Bounce, But Stopped at Trendline - 16th Apr 18
How To Profit As Oil Prices Explode - 16th Apr 18
Junior Mining Stocks are Close to Breaking Downtrend - 16th Apr 18
Look Inside a Caravan at UK Holiday Park for Summer 2018 - Hoseasons Cayton Bay Sea Side - 16th Apr 18
Stock Market More Weakness? How Much? - 15th Apr 18
Time for the Gold Bulls to Show their Mettle - 15th Apr 18
Trading Markets Amid Sound of Wars - 15th Apr 18
Sugar Commodity Buying Levels Analysis - 14th Apr 18
The Oil Trade May Be Coming Alive - 14th Apr 18

Market Oracle FREE Newsletter

Trading Lessons

Why Does JPMorgan Still Have A Banking License?

Companies / Banksters Nov 08, 2013 - 01:22 PM GMT

By: Raul_I_Meijer

Companies

I was, well, still am, reading up on the latest developments in the wonderful world of Libor, and the name JPMorgan pops up a lot in connection with all that. There's of course the recent -probably still tentative - $13 billion settlement with the US Justice Department. Seeing all the separate cases that have either been settled or are under active investigation in which JP Morgan is mentioned, along with a couple small lists in the WaPo And HuffPo, I figured it might be a good idea to make a more complete list (though I have no doubt I could make it twice as long) of actually investigated cases America's largest bank is a part of.


JPMorgan's total assets amount to $2.509 trillion, its derivatives exposure is $70-$80 trillion, and it's certainly too big to fail and systemically important. But seeing a list like this, how can anyone not wonder that if this is what the system depends on, the system itself is so rotten we need to get rid of it? I mean, what does it take, a modern day version of the Untouchables? Not that I think they'd get JPMorgan for tax evasion, mind you. But right now, nobody gets them for anything at all, except for a few billion here and there in fines that the perpetrators themselves don't even get to pay. The $13 billion settlement is only just over a third of what JPMorgan is spending on lawyers to defend itself and it executives.

Or, as Katrina vanden Heuvel puts it in the Washington Post:

Jamie Dimon will pay the fines with other people’s money — that of his shareholders. Neither he nor his officers who made out like bandits from their fraudulent practices are asked to chip in a dime. In fact, the $13 billion is itself something of a put-on. Only $9 billion is in cash, and much of that may well be tax-deductible, meaning taxpayers will get part of the bill. Four billion dollars is in “mortgage relief,” which the banks have been notoriously successful in gaming, providing “relief” by discarding underwater mortgages, “allowing” homeowners to do a short-sale that costs them their homes.

Here's my list. JPMorgan has already paid billions to settle charges, and in many cases faces ongoing investigations, for:

(1) Manipulating the market in the London Whale trading debacle

(2) Rigging energy prices in California and the Midwest

(3) Improperly foreclosing on homeowners

(4) Bilking credit card holders by fixing prices and interest rates The bank said it will pay about $1.2 billion to settle charges that it conspired with MasterCard and Visa to rig credit-card swipe fees.

(5) Rigging municipal bond operations in 31 states

(6) Gouging some 6,000 active-duty service members on their mortgages

(7) Mis-selling interest-rate swaps to the city of Milan, Italy in 2005

(8) Enron - The bank and some of its executives are still being sued over the bank's relationship with the fraud-based energy giant, more than a decade after its failure

(9) Aiding and abetting Bernie Madoff's Ponzi ; the Madoff bankruptcy trustee and others have also sued the bank to get back some Madoff clients' money

(10) Its relationship with failed brokerage firm MF Global ; it is also being sued for allegedly aiding and abetting MF Global misuse of customer money.

(11) Involvement in $215 million worth of missing clients' money in the collapse of Iowa brokerage firm Peregrine Financial Group

(12) Allegations that it knowingly sold faulty US mortgage securities ; after [direct discussions between the bank’s chief executive, Jamie Dimon, and Attorney General Eric H. Holder Jr.], JPMorgan reached a tentative agreement with the Justice Department to pay a record $13 billion

(13) Manipulating EURIBOR (and yen Libor) rates , in a case in which the EU's Competition Commission is set to impose up to €5 billion in fines to a group of at least 6 banks

(14) Manipulating WM/Reuters rates ; JPMorgan is one of 7 banks that have confirmed investigators in the U.S. and Europe are investigating their foreign exchange trading and manipulating of WM/Reuters rates (an industry-wide standard used in determining closing prices in the $5.3 trillion-a-day foreign exchange market, published hourly for 160 currencies and half-hourly for the 21 most-traded. )

(15) Manipulating Libor rates In the bank's own words in 2012: "JPMorgan Chase has received subpoenas and requests for documents and, in some cases, interviews, from the DOJ, CFTC, SEC, European Commission, UK Financial Services Authority, Canadian Competition Bureau, Swiss Competition Commission and other regulatory authorities and banking associations around the world."

(16) In a separate case: Colluding to artificially lower the Libor rate ; between 2007 and 2010, in legal action brought by US mortgage provider Fannie Mae, which alleges that the collusion led it to lose money on interest rate swaps, mortgages and mortgage-backed securities, with a $332 million loss just from interest rate swaps. Fannie seeks to recoup $800 million.

My guess is that should be more than enough to revoke JPMorgan's banking license, at least temporarily. Instead, the bank keep posting huge profits and the executives involved in all these cases keep receiving huge bonuses. Of course there are people honestly trying to hold Jamie Dimon and his gang responsible for their actions. But as long as they can't be simply put out of business, as anyone in just about any other sort of business would, it's not much use. Fines and settlements are a waste of time and money if someone else winds up paying them. And what does it say about America if it feels that it must let these guys get away with everything and anything? In my mind's eye, I see one of those typical endings to an old John Ford western, with both the spirit and the rule of law riding off into the sunset.

By Raul Ilargi Meijer
Website: http://theautomaticearth.com (provides unique analysis of economics, finance, politics and social dynamics in the context of Complexity Theory)

© 2013 Copyright Raul I Meijer - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
Raul Ilargi Meijer Archive

© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules