JPMorgan’s crime spree continues. While the Too Big To Fail/Jail bank was already being investigated for violating the Foreign Corrupt Practices Act (FCPA) for hiring children of the the Chinese Communist Party elite in exchange for influence with the Chinese government, The Wall Street Journal claims a new report will show further crimes.
According to the Journal, JPMorgan is preparing to submit a report to US investigators in April that shows the firm hired 222 candidates connected to the Chinese elite under what was known internally as the “Sons and Daughters” program. So, not a few bad apples or isolated incidences, but a broadly practiced policy.
The program detailed in the report reveals that JPMorgan’s corrupt hiring practices were widespread and often involved favors beyond seeking better treatment from the Chinese government. JPMorgan often hired children of companies the bank took public and did business with in Hong Kong:
Under the program, which ran from 2004 to 2013, J.P. Morgan took referrals from a broad spectrum of China’s business and political elite, the document shows. Nearly half came from the government, including regulators of the banking, insurance and securities industries, senior executives of major state-owned companies and provincial and central-government officials.
The bank was hired to work on 12 Chinese initial public offerings of $1 billion or more in Hong Kong over the period that was examined, according to an analysis of Dealogic data. The J.P. Morgan document shows the bank hired candidates referred by officials at nine of those companies or their corporate parents.
The hiring program coincides with the rise of JPMorgan’s business in China and Hong Kong, specifically. By all accounts, JPMorgan payed-to-play in China. The payment took the form of high-paying jobs for relatives of government and business officials.
That behavior is explicitly banned by FCPA, which makes it a federal crime to give anything of value to foreign government officials in hopes of influencing them. JPMorgan’s only defense is that those 222 people connected to the Communist Party elite and state-owned enterprises were all, somehow, the best candidates.
But let’s get real. JPMorgan is, in truth, relying on a comically pathetic US Department of Justice to continue to be a sad joke. JPMorgan went on one of the most epic crime sprees in American history and did not even receive a slap on the wrist thanks to the Obama Administration’s DOJ. Why would they start holding the banksters accountable now?
The likely result of all this will be JPMorgan getting an equivalent deal to what BNY Mellon received for its illegal corrupt hiring practices in the Middle East: a small fine and no real consequences. The DOJ under Attorney General Loretta Lynch talks tough, but has yet to offer any action to back up its words on prosecuting major corporate criminals.