Not soon after JPMorgan settled yet another case involved screwing homeowners, JPMorgan CEO Jamie Dimon decided to publicly lament his “unfair” treatment by the government. Dimon said that “I think a lot of it was unfair, but I’m not going to go into details” about a recent settlement with the Justice Department over a series of crimes that span from fraud in the mortgage market to helping Bernie Madoff run one of the biggest ponzi schemes in history.
The remarks came, of course, from Davos during the Word Economic Forum where the people that own the world meet with the people that govern it to help set the next year’s agenda. Dimon not only said the treatment was unfair but that the criminal conduct was not really his fault as most of the cases were from companies that were acquired by JPMorgan.
“I think a lot of it was unfair, but I’m not going to go into details,” Dimon said, adding that he was glad to have the mortgage investigations behind him. Dimon argued that “80 percent” of the misrepresentations about mortgage-backed financial products involved in the case originated at two banks JP Morgan acquired at the height of the financial crisis, and that it is unfair to hold his company responsible for Bear Stearns and Washington Mutual employees’ conduct prior to those acquisitions.
The first point to make is when you acquire a company you take the bad with the good. JPMorgan is happy to take the profits from those enterprises. But also worth noting is that many of JPMorgan’s crimes are not from acquisition companies.
The London Whale incident, the Bernie Madoff affair, and much of the firm’s own conduct in the mortgage market is no one else’s fault nor responsibility. And that is all before any charges are brought in JPMorgan’s latest criminal scheme – hiring government officials’ relatives in China which is likely a violation of the Foreign Corrupt Practices Act.
And what about the “unfair” treatment in response to this crime spree? The closest JPMorgan has gotten to criminal court is a deferred prosecution for its involvement with Bernie Madoff. Deferred prosecution, which is to say special treatment by the Justice Department. The idea that JPMorgan is being treated “unfairly” only makes sense if you mean they are being treated too leniently.