McCain Pressures Justice to Hold JPMorgan Executives Accountable
U.S. Senator John McCain pressured the Justice Department to hold JPMorgan Chase & Co. (JPM) executives individually accountable while they work to settle claims that the bank packaged and sold bad mortgage bonds to investors.
“Will you seek to hold any top officer, director or key employees within JPMorgan personally accountable for the wrongdoing?” McCain, of Arizona, wrote in a letter today to Attorney General Eric Holder. McCain, the ranking Republican on a Senate subcommittee that probed JPMorgan’s record trading loss last year, criticized Holder’s Sept. 26 meeting with Chief Executive Officer Jamie Dimon, calling it “highly unusual.”
The lender is in talks to pay about $11 billion to end investigations by state and federal authorities into its mortgage-bond sales practices, according to people familiar with the talks, who requested anonymity because the negotiations are private. The discussions are fluid and the size of the settlement keeps changing, the people said.
McCain asked Holder whether the settlement being discussed will preclude civil or criminal actions against JPMorgan executives and whether the structure of the deal will allow the New York-based bank to receive tax breaks on fines or penalties it may pay, according to the letter.
“Your personal meeting with the CEO of the corporate target of a major criminal investigation, at the request of the CEO, while negotiations on a global settlement agreement are pending, is highly unusual and, under the circumstances that the meeting occurred, gives rise to concern,” McCain said.
JPMorgan individuals and political action committees have been among the senator’s top five contributors since 1989, according to data compiled by the Center for Responsive Politics, a government watchdog group.
Joe Evangelisti, a JPMorgan spokesman, declined to comment on McCain’s letter.
The bank incurred losses exceeding $6.2 billion last year on a derivatives position built by a trader who came to be known as the London Whale because his bets were so large. The Senate’s Permanent Subcommittee on Investigations issued a 301-page report accusing JPMorgan of hiding losses and referred its finding to the SEC and Justice Department in April.
Dimon, 57, is among bank chiefs who will meet with President Barack Obama this week as Wall Street urges Congress to end the budget stalemate in Washington. The Oct. 2 White House visit, confirmed by three people familiar with the schedule, was set up by the Financial Services Forum, a trade group representing the CEOs of the 19 biggest banking and insurance firms.
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