It wasn’t long ago that Jamie Dimon was America’s favourite banker — shaking hands and wearing his Presidential cuff links on Congressional panels, admonishing bad bankers with speeches about “Old Testament justice.”
He was the head of the bank that didn’t take America’s money.
But according to the NYT that kind fo cache can only last for so long. Ben Protess and Jessica Silver-Greenberg report that last month Dimon met with government officials at JP Morgan’s headquarters. They warned him that he and his bank are losing credibility in Washington.
There are number of reasons for this. Officials from the Office of the Comptroller of Currency told Dimon that they are considering enforcement action against the bank for the way it collected credit card debt, for it’s failure to report Bernie Madoff, for withholding documents about its $6 billion trading loss, and for shady dealings in the energy market.
The 70-page document also took aim at a top bank executive, Blythe Masters. A seminal Wall Street figure, Ms. Masters is known for helping expand the boundaries of finance, including the development of credit default swaps, a derivative that played a role in the financial crisis.
The regulatory document cites her supposed “knowledge and approval of schemes” carried out by a group of energy traders in Houston. The agency’s investigators claimed that Ms. Masters had “falsely” denied under oath her awareness of the problems and said that JPMorgan had made “scores of false and misleading statements and material omissions” to authorities, the document shows.
It is unclear, as yet, if the regulator will file any type of action against JPM. It’s a five member body and a majority of them have to approve the decision. For it’s part, JPM has said that it will “vigorously” defend itself against any accusations.
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