JPMorgan Chase & Co., one of the Big Four banks of the United States, is facing yet another scandal — and another federal probe for possible crimes and improprieties. This time the federal Securities and Exchange Commission (SEC) is investigating whether JPMorgan Chase violated the U.S. Foreign Corrupt Practices Act by hiring Chinese “princelings” — sons and daughters of China’s super-wealthy Communist Party officials — in order to win business contracts from China’s state-owned enterprises (SOEs). While it is not illegal for U.S. companies to hire people who are politically connected, doing so with the expectation of winning business from their relatives is considered bribery.
It is hardly shocking that JPMorgan Chase may be guilty of this practice; what else would one expect when one of the wealthiest and most corrupt banks in the world partners with one of the wealthiest, most corrupt, and ruthless regimes in the world? But JPMorgan Chase is hardly alone; virtually all of the big investment banks operating in China have been using the “hire-a-princeling” strategy as standard operating procedure for the past two decades.
Last week, two of the bank’s former London traders — Javier Martin-Artajo and Julien Grout — were indicted for allegedly concealing massive bank losses in the infamous “London whale” debacle. When we reported on the matter last year, the losses were listed as $2 billion. Now, it turns out, those losses were seriously under counted; the real losses are around $6.2 billion.
So far, the bank’s CEO, Jamie Dimon, has not only managed to evade any personal responsibility for the company’s ongoing massive scandals, but continued to profit — at taxpayer expense.
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