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(CNN)   Sure, JP Morgan imperiled the banking system with their reckless behavior, but haven't they been punished enough already?   (finance.fortune.cnn.com) divider line 30
    More: Fail, JPMorgan Chase & Co., London Whale, bankers, accounting fraud, book value, Securities and Exchange Commission, trading strategy  
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1005 clicks; posted to Business » on 18 Sep 2013 at 10:34 AM (44 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



30 Comments   (+0 »)
   
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2013-09-18 10:46:34 AM
I kind of agree (with the article headline, didn't actually RTFA).

We should be more concerned with the bets they rig, not the ones they lose.
 
2013-09-18 10:49:27 AM
Are they hanging from ropes in a tree?
 
2013-09-18 10:55:54 AM

Wendy's Chili: I kind of agree (with the article headline, didn't actually RTFA).

We should be more concerned with the bets they rig, not the ones they lose.


It's called Trust. The whole financial industry is build on it. You lie you pay.
 
2013-09-18 10:58:21 AM
The fine isn't for "imperiling the banking system", it's for falsifying bank records and regulatory filings to hide the losses from investors.
 
2013-09-18 10:59:19 AM
Are they still in business? Then no, they haven't been punished enough.
 
2013-09-18 10:59:20 AM
Banks are being targeted for political reasons? Obvious tag, please.
 
2013-09-18 11:01:35 AM
Meh.  There should be better regulation of excessive risk-taking, period; if the "London Whale" guy was not properly supervised and violated those rules, then he should certainly be punished, whether or not the loss cost the taxpayers money.  But in the absence of well-defined rules, the fine doesn't pass the smell test.

That said, if it's really that bad, JPM could certainly sue the SEC.  $800 M is chump change to them but they'd probably still rather not pay it.
 
2013-09-18 11:03:12 AM
It was a risky deal made by a guy that had brought in billions in risky deals.

With the bank's money, not shareholder's.
 
2013-09-18 11:10:18 AM

R.A.Danny: It was a risky deal made by a guy that had brought in billions in risky deals.

With the bank's money, not shareholder's.


The bank is a public company.  All of its assets belong to the shareholders.
 
2013-09-18 11:11:25 AM

Lucky LaRue: R.A.Danny: It was a risky deal made by a guy that had brought in billions in risky deals.

With the bank's money, not shareholder's.

The bank is a public company.  All of its assets belong to the shareholders.


Did any shareholders lose money?

Nope, they made money.
 
2013-09-18 11:13:51 AM

R.A.Danny: Lucky LaRue: R.A.Danny: It was a risky deal made by a guy that had brought in billions in risky deals.

With the bank's money, not shareholder's.

The bank is a public company.  All of its assets belong to the shareholders.

Did any shareholders lose money?

Nope, they made money.


So, as long as a public company makes money for its shareholders, there shouldn't be any punishment for lying and filing false reports with regulatory agencies?  Do I have your argument right?
 
2013-09-18 11:15:39 AM

Lucky LaRue: R.A.Danny: Lucky LaRue: R.A.Danny: It was a risky deal made by a guy that had brought in billions in risky deals.

With the bank's money, not shareholder's.

The bank is a public company.  All of its assets belong to the shareholders.

Did any shareholders lose money?

Nope, they made money.

So, as long as a public company makes money for its shareholders, there shouldn't be any punishment for lying and filing false reports with regulatory agencies?  Do I have your argument right?


Yes, because ultimately the shareholders are paying it (remember, you clearly stated that it is the shareholder's money), not the guilty parties.
 
2013-09-18 11:16:13 AM
Attempting to punish them for malfeasance is CLEARLY class warfare. Duh.
 
2013-09-18 11:16:38 AM
Maybe, just maybe, the fine is to punish them enough that they will not lie in the future.  Not lying may lead to avoiding bigger problems that will have larger, more public repercussions.
 
2013-09-18 11:17:37 AM

R.A.Danny: Lucky LaRue: R.A.Danny: It was a risky deal made by a guy that had brought in billions in risky deals.

With the bank's money, not shareholder's.

The bank is a public company.  All of its assets belong to the shareholders.

Did any shareholders lose money?

Nope, they made money.


Well they lost money on the trade(s), just not enough to put JPM into the red for that quarter.  Still, there was something about them having to restate its financial statements -- if they tried to actually hide (or are still hiding) the true state of their financial position from their shareholders, then that should be punished.
 
2013-09-18 11:20:06 AM

Arkanaut: Still, there was something about them having to restate its financial statements -- if they tried to actually hide (or are still hiding) the true state of their financial position from their shareholders, then that should be punished.


The people should be punished. As we have already established, punishing a corporation is really only punishing the shareholders and not the guilty parties.
 
2013-09-18 11:29:29 AM
there should be a law that makes all the money generated by fines against the financial industry (after the cost of said regulation) go directly to social programs, especially food stamps.
 
2013-09-18 11:33:06 AM

R.A.Danny: Arkanaut: Still, there was something about them having to restate its financial statements -- if they tried to actually hide (or are still hiding) the true state of their financial position from their shareholders, then that should be punished.

The people should be punished. As we have already established, punishing a corporation is really only punishing the shareholders and not the guilty parties.


There's an argument for pushing them to do a better job of supervising their executives, but there has been a lot of pressure in the SEC to push for monetary settlements.  Maybe it's a budgetary thing, maybe they like the big numbers because they make better headlines; but it's preventing them from locking up the people who are putting the financial system in danger.  Mary Jo White was supposed to stop that trend; clearly that hasn't happened yet.
 
2013-09-18 11:33:36 AM
Nothing short of public hangings of every officer and member of management is punishment enough.
 
2013-09-18 11:33:56 AM
Glass-Steagle worked really well for decades.  Deregulation has always wreaked havoc.
 
2013-09-18 11:37:30 AM
The United States entered WWI because of J.P. Morgan and his $562 million dollar loans to France, England and Russia. If the Allies had lost the war, Morgan and his cronies would have lost fortunes. And that wasn't going to happen.

So when your loved ones go off to fight another oil war somewhere over there, you can thank the man who started it all. J.P. Morgan.
 
2013-09-18 11:39:46 AM

R.A.Danny: Lucky LaRue: R.A.Danny: Lucky LaRue: R.A.Danny: It was a risky deal made by a guy that had brought in billions in risky deals.

With the bank's money, not shareholder's.

The bank is a public company.  All of its assets belong to the shareholders.

Did any shareholders lose money?

Nope, they made money.

So, as long as a public company makes money for its shareholders, there shouldn't be any punishment for lying and filing false reports with regulatory agencies?  Do I have your argument right?

Yes, because ultimately the shareholders are paying it (remember, you clearly stated that it is the shareholder's money), not the guilty parties.


What about the shareholders that invested based on the lies told to them by JP Morgan?

If you allow public companies to lie, then you end up with a system where a company will say whatever it needs to in order to attract investors and their money.  Ultimately, there will be no faith in the system and the market will collapse.
 
2013-09-18 11:44:03 AM

Lucky LaRue: If you allow public companies to lie, then you end up with a system where a company will say whatever it needs to in order to attract investors and their money.


Companies cannot lie. They cannot even talk.
 
2013-09-18 11:46:19 AM

Carn: Are they hanging from ropes in a tree?


Swing, you Dogs!
 
2013-09-18 11:47:13 AM

R.A.Danny: Lucky LaRue: If you allow public companies to lie, then you end up with a system where a company will say whatever it needs to in order to attract investors and their money.

Companies cannot lie. They cannot even talk.


goddamnit..

25.media.tumblr.com
 
2013-09-18 11:49:56 AM

Lucky LaRue: R.A.Danny: Lucky LaRue: If you allow public companies to lie, then you end up with a system where a company will say whatever it needs to in order to attract investors and their money.

Companies cannot lie. They cannot even talk.

goddamnit..

[25.media.tumblr.com image 599x314]


No, you fine a company as a whole, the people making money (the stockholders, remember them?) will demand that the money is made up somewhere else. Usually that is done with layoffs.

Does it seem counterproductive to fine the company as a whole now?

Toss those that lied to the wolves, but the company itself is an inanimate entity.
 
2013-09-18 12:44:49 PM
They have $200 billion to cover fines and losses?

Seems like that $100 million should have been MUCH bigger.
 
2013-09-18 01:03:20 PM
two articles in a row

the rich and powerful

and why you should love them
 
2013-09-18 02:29:33 PM
How about that recent FERC action on JP's `enrond skimming' around the regs?

Under the agreement, JPMVEC will pay a civil penalty of $285 million to the U.S. Treasury and disgorge $125 million in unjust profits. The first $124 million of the disgorged profits will go to ratepayers in the California Independent System Operator (California ISO), which operates the California electricity market. The other $1 million will go to ratepayers in the Midcontinent Independent System Operator (MISO).

FERC investigators further determined that JPMVEC knew that the California ISO and MISO received no benefit from making inflated payments to the company, thereby defrauding the ISOs by obtaining payments for benefits that the company did not deliver beyond the routine provision of energy. FERC investigators also determined that JPMVEC's bids displaced other generation and altered day ahead and real-time prices from the prices that would have resulted had the company not submitted the bids.


http://www.ferc.gov/media/news-releases/2013/2013-3/07-30-13.asp#.Uj nt vPn9HpQ

This is not unlke JP's involvement with the London Metals Exchange - skimming `rent' from aluminum (what `real' economy?)
 
2013-09-18 02:34:56 PM

mrlewish: Wendy's Chili: I kind of agree (with the article headline, didn't actually RTFA).

We should be more concerned with the bets they rig, not the ones they lose.

It's called Trust. The whole financial industry is build on it. You lie you pay.


It's also a question of law. Did they violate the regulations that the are required to follow? If so, then they should be penalized accordingly, even if their actions hurt only themselves.

The penalty is not only about punishing past behavior, it is about guiding future behavior.
 
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