News crossed this weekend that
U.S. bank JP Morgan is being investigated by U.S. regulators for hiring well-connected people in China.
Specifically, the bank is said to be under investigation for hiring two bankers whose fathers ran big Chinese companies that later hired JP Morgan for several assignments.
So that’s against the rules now?
Hiring well-connected people?
And that’s what U.S. regulators are spending their time doing–investigating whether J.P. Morgan is hiring well-connected people in China?
(I don’t mean to sound naive here: Obviously, hiring the children of powerful business executives can provide a relationship-driven company with a competitive edge. But companies hire the children of powerful executives all the time, all over the world. And they also hire people who have excellent industry and government relationships from childhood, college, business school, and professional life, all of which are extremely useful. So where do you draw the line? Will US banks be investigated when they hire Tim Geithner, Ben Bernanke, Larry Summers, et al?)