Senator Elizabeth Warren and Bloomberg News Need to Give It a Rest with Bashing Wells Fargo and Turn Their Attention to 5-Count Felon, JPMorgan Chase

By Pam Martens and Russ Martens: September 17, 2021 ~

Jamie Dimon, Chairman and CEO of JPMorgan Chase

Jamie Dimon, Chairman and CEO of JPMorgan Chase

On Tuesday of this week, Bloomberg News published its umpteenth negative article on the San Francisco-headquartered bank, Wells Fargo. This time around, the article was highlighting Senator Elizabeth Warren calling for Wells Fargo to be broken up, with its federally insured bank separated from its Wall Street businesses.

Bloomberg News syndicates its articles, so this story was quickly splashed all over other news outlets.

And that’s the way it has been going since 2017. When Senator Warren bashes Wells Fargo, she gets lots of coverage by New York media outlets.

Since March of 2018, Bloomberg News has published more than 80 negative articles on Wells Fargo with headlines like these: Wells Fargo CEO Abruptly Steps Down, Succumbing to ScandalsWells Fargo’s CEO Disputes Claim His Bank Is Too Big to ManageElizabeth Warren on Wells Fargo CEO’s Departure: ‘About Damn Time’; Ex-Wells Fargo Bosses Face US$59M in Fines; Stumpf Gets Ban.

Based on all of this negative media coverage, particularly at Bloomberg News, one would think that Wells Fargo is the most criminally-inclined bank in the United States. But here is where this story gets particularly curious. While Senator Warren and Bloomberg News have turned Wells Fargo into a piñata, Wells Fargo has not actually been charged with even one felony count by the U.S. Department of Justice. JPMorgan Chase, on the other hand, is the only U.S. federally-insured bank in history to be charged with five felony counts in the span of seven years, while keeping the same man, Jamie Dimon, as its Chairman and CEO.

Wells Fargo’s former CEO John Stumpf has been banned from the banking industry over the fake account scandal at Wells Fargo (a sales incentive program gone wrong) while Jamie Dimon has kept both titles of Chairman and CEO while having his annual pay hiked to over $30 million a year by his crony Board of Directors.

There is no question that the deferential treatment bestowed on Dimon by New York media has played a prominent role in Dimon keeping his job. That deference has particularly come from billionaire Michael Bloomberg, majority owner of Bloomberg News, who frequently acts like an advance man for Dimon. In 2016, after JPMorgan Chase had racked up three felony counts over the prior two years, Mike Bloomberg and Dimon even co-authored an opinion piece for Bloomberg News.

On May 31, 2012, as Dimon was under scrutiny for the insane outrage of allowing his federally-insured bank to use depositors’ money to gamble in exotic derivatives in London, eventually losing $6.2 billion of depositors’ money, Mike Bloomberg lavished praise on Dimon in the Wall Street Journal, calling him “a very smart, honest, great executive.” (It should be noted that Mike Bloomberg made his billions leasing the Bloomberg Data Terminal to large global trading outfits like JPMorgan Chase.)

Wells Fargo is not a boy scout by any means. But the U.S. Department of Justice apparently felt Wells Fargo was not deserving of being charged with any felony counts while slapping JPMorgan Chase with five felony counts for a mind-numbing array of crimes.

On January 7, 2014 JPMorgan Chase pleaded guilty to two felony counts for its role in the Bernie Madoff Ponzi scheme, the largest Ponzi scheme in history with $17.5 billion in principal looted. (If you add in the time value of money, investors lost well over $50 billion over the decades that Madoff ran his scheme.) JPMorgan Chase held the business bank account for Madoff and told regulators in the U.K. that it thought a Ponzi scheme was occurring while withholding that information from its bank supervisors in the U.S. As we previously reported, there were so many frauds occurring out of the Madoff business bank account that it looked like those Russian nesting dolls, with one fraud neatly tucked within another.

JPMorgan Chase’s own bank customers were fleeced from the Madoff scheme as well. According to a 2016 report from the Government Accountability Office (GAO), the bank’s customers lost “about $5.4 billion” in the Madoff scheme.

In March 2016, trial attorneys Helen Davis Chaitman and Lance Gotthoffer published their book, JPMadoff: The Unholy Alliance between America’s Biggest Bank and America’s Biggest Crook. That same month, Dimon was featured on the front cover of the magazine, Bloomberg Markets, with a feature story inside that characterized Dimon as the whizz kid of Wall Street. There is no mention of any felony charges in the article.

The trial attorneys wrote this in their book:

“In Chapter 4, we compared JPMC to the Gambino crime family to demonstrate the many areas in which these two organizations had the same goals and strategies. In fact, the most significant difference between JPMC and the Gambino Crime Family is the way the government treats them. While Congress made it a national priority to eradicate organized crime, there is an appalling lack of appetite in Washington to decriminalize Wall Street. Congress and the executive branch of the government seem determined to protect Wall Street criminals, which simply assures their proliferation.”

And this:

“If Jamie Dimon is running a criminal institution, he should be prosecuted for it. And law enforcement has the perfect tool for such a prosecution: the Racketeer Influenced and Corrupt Organizations ACT (RICO).

“Congress enacted RICO in 1970 in order to give law enforcement the statutory tools it needed to prosecute the people who committed crimes upon orders from mob leaders and the mob leaders themselves. RICO targets organizations called ‘racketeering enterprises’ that engage in a ‘pattern’ of criminal activity, as well as the individuals who derive profits from such enterprises. For example, under RICO, a mob leader who passed down an order for an underling to commit a serious crime could be held liable for being part of a racketeering enterprise. He would be subject to imprisonment for up to twenty years per racketeering count and to disgorgement of the profits he realized from the enterprise and any interest he acquired in any business gained through a pattern of ‘racketeering activity.’ ”

In 2019, for the first time that anyone on Wall Street can remember, RICO charges were actually brought against traders at JPMorgan Chase and its precious metals trading desk was characterized as a racketeering enterprise by the U.S. Department of Justice. For some strange reason, the Justice Department couldn’t bring itself to state the name of the bank where the traders were located, calling JPMorgan Chase simply “Bank A.”

Last year, on September 29, the Justice Department brought two more felony counts against JPMorgan Chase, one involving the rigging of precious metals markets and the other for rigging the U.S. Treasury market – you know, the market that allows the federal government to pay its bills. As the Justice Department had done in all the previous felony charges against the bank, it settled them with large fines, deferred prosecution agreements, and a probation period. (The bank has had three probation periods since 2014 for criminal activity.) But the Justice Department did one thing on September 29 that was unprecedented for a felony charge involving the rigging of the U.S. Treasury market. The Justice Department announced the charges without holding its standard press conference and taking questions from reporters.

The Justice Department’s deal was so sweet for a criminal recidivist that the Justice Department notes that “an independent compliance monitor was unnecessary” for the bank despite also revealing that the bank “did not voluntarily and timely disclose to the Fraud Section and the Office the conduct described in the Statement of Facts.” It was required to do that under its prior probation agreement that ended in January of 2020.

So, to summarize: Wells Fargo did not facilitate the largest Ponzi scheme in history; it did not lose $6.2 billion of depositors’ money at its federally-insured bank through wild gambles in derivatives in London; it has not been criminally charged with rigging three separate markets – foreign exchange, precious metals, and the U.S. Treasury market.

And, Wells Fargo’s regulators have not determined that it is the riskiest bank in America. That distinction, along with the five felony counts, belongs to JPMorgan Chase.

If we’re going to start talking about breaking up behemoth banks and crime syndicates, that conversation needs to start with JPMorgan Chase and it needs to start right now.

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