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EDITOR’S NOTE: If the press can ask the questions leading right up to the top of the megabanks, why can’t the government? You have to remember that these people practically invented the term “due diligence” and before the securitization scam, it was very challenging to get a deal through where all the i’s were not dotted. The point here is not whether Jamie Dimon belongs in jail. The point is that the securitization scam was intentional and there are civil remedies for everyone who was hurt by it.

JPM set up an investment that they knew at the highest levels was going to fail, didn’t tell their investor (of course) because they were going to  make a lot of money BECAUSE the investor was going to lose money. This is what was done to investors in mortgage-backed bonds and what was done to homeowners who put up their house for an “investment” that was already doomed. Facts like these help make the case for appraisal fraud and other deceptive lending practices. And it shows how the megabanks were pulling the strings through remote vehicles and then defending with plausible deniability.

My answer is that their denial is not plausible and not even possible. Nobody accidentally makes $2 billion on a client’s loss of $500 million. We’re not talking the lottery here. We are talking high finance where the controls and command centers are limited to a few rooms with very few people in those rooms.

Investing in the Dark

NY Times Editorial

So what did Jamie Dimon know and when did he know it?

New documents unsealed recently in a class-action lawsuit against JPMorgan Chase — some of which name Mr. Dimon, the chief executive — paint yet another picture of a bank profiting while its clients suffer. At issue is a precrash investment vehicle, named Sigma, in which the bank had invested $500 million in assets from pension funds and other clients, nearly all of which the clients say was lost when the investment tanked in 2008.

The clients were blindsided because they believed that Sigma was a safe way to invest. JPMorgan was not taken by surprise. As Louise Story reported in The Times on Monday, court documents show that warnings by top bank officials about Sigma and similar investments went all the way up to Mr. Dimon’s office.

The gist of the warnings was not how to protect clients, but how the ailing Sigma presented the bank with what one e-mail described as “very big moneymaking opportunities as the market deteriorates.”

When Sigma did indeed collapse, JPMorgan collected nearly $1.9 billion, according to the suit, a figure the bank disputes, without providing any alternative figure.

It is possible that JPMorgan did nothing wrong legally — and that is precisely the problem. It clearly stinks to withhold information that may well have caused clients to change their minds — in effect, for the bank to treat clients’ money with less care than it treats its own. As long as banks operate that way, there is no restoring trust in the financial system, or, by extension, in the political system that props it up.

But is it illegal? JPMorgan has said that the unit of the bank that handled the clients’ investments in Sigma was not, by law, allowed to confer with the unit of the bank that benefited from Sigma’s demise. That may be true, but as Ms. Story pointed out, in this case, the information rose to executives who oversee the entire company and were in a position to intervene. That they did not is a failure to do the right thing, even if the court decides that the bank did not break the law.

In the meantime, efforts to write new rules to try to curb such conflicts is hamstrung by a Republican backlash against the Dodd-Frank financial reform law that was passed last year. There is proposed legislation to repeal provisions of the law, and the agencies that have to implement the law are in danger of not getting enough money to do the job. As the pension funds in the class-action suit against JPMorgan can certainly attest, only the banks will benefit from business as usual.

16 Responses

  1. […] View the original article here Tags:CUSTOMERS, DIMON, JAMIE, MAKING, PROFIT, STICKING. This entry was posted on Thursday, April 28th, 2011 at 9:23 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a comment, or trackback from your own site. You can . « Pretender Signers: How Appearances Can Be Deceiving Leave a comment Name (required) […]

    The activities going on are spinn!
    Wnat to “peak” at the Federal Reserve Repository institution of your choice:

    Federal Reserve System
    National Information Center
    ‘A repository of financial data and institution characteristics collected by the Federal Reserve System.

    Paste hyperlink and when Institution Search appears, change one field for searchs

    “Country” change from ‘United States’ the default, to [ANY COUNTY INCLUDES U.S.]

    For all of the foreign organizations are required by laws Congress created to have address in USA as a legal business entity in order to move currency over private financial exchanges.

    Less is more when searching data facts.


    Want to see information on parent for example

    ‘Wells Fargo & Company’

    RSSD ID: 1120754

    Looking at Display, type number into first box on right hand side of screen, and change ‘County’ to
    [Any County Includes U.S.]

    Then click on SUBMIT

    WELLS FARGO & COMPANY (1120754)
    Financial Holding Company – Domestic

    Click on Name (RSSD ID)
    Wells Fargo & Company which is a hot link

    Use to be Norwest Corporation’s headquarters and took on the valuable ‘private brand label’ acquired 11/2/1998 ‘Wells Fargo & Company’.

    Business as usual for former Norwest Corporation who survived the merger or I call it marriage and each spouse bringing with them ‘baggage.’

    Wells Fargo & Company (Parent)

    3/13/2000 began operating as a financial holding company

    Wells Fargo & Company formerly Norwest Corp
    420 Montgomery Street
    San Francisco, CA 94104

    “How does a Bank Holding Company BHC become a FHC?

    A BHC must file a declaration with the appropriate Federal Reserve Bank and the Federal Reserve Board certifying that all of its depository institution subsidiaries are well-capitalized and well-managed.

    We’ll that’s impartial!

    Click on hot-link ‘Financial Holding Company-Domestic’ for definition of superior class of consumer Congress chooses to sanction
    ‘fine’ for illicit acts making lawlessness profitable.

    From the FFIEC.GOV Institution definitions:

    Click on hot-link “Financial Holding Company” reveals:

    A financial entity engaged in a broad range of banking-related activities, created by the Gramm-Leach-Bliley Act of 1999.

    These activities include:
    -insurance underwriting,
    securities dealing and underwriting,
    financial and investment advisory services, merchant banking,
    issuing or selling securitized interests in bank-eligible assets, and
    generally engaging in any non-banking activity authorized by the Bank Holding Company Act.

    The Federal Reserve Board is responsible for supervising the financial condition and activities of financial holding companies.

    Similarly, any non-bank commercial company that is predominantly engaged in financial activities, earning 85% or more of its gross revenues from financial services, may choose to become a financial holding company.

    These companies are required to sell any non-financial (commercial) businesses within ten years.

    End of FFIEC.GOV disclosure

  3. […] diligence” and before the securitization scam, it was very challenging to get a … – ReadmoreDiscover how to easily make your favorite restaurant dishes at home! Discounts are available Click […]

  4. Yes. however the system forces you to allow them to hold your investment assets in their name–so when they go bankrupt, we become unsecured creditors, and our “investment accounts” are merely used to apportion losses to us. We suffer losses based on what their failures, after they made off with the money–the downside of wild speculation is on retirement accounts. The only backstop we have is federal insurance programs. A backdoor bailout–similar to what they did in Iceland and Ireland. Only for us, what will they do ? Add to the deficit or declare “losers weepers”. The obvious solution is to declare our investment accounts to be our property under their custody—-that shares in their custody etc are directly allocated to us —not their obligations. This is the way they present the statements to us but that is not a proper representation of the legal status of what we think are “our assets”. No all we have are claims–not stocks nor bonds. but statutes today REQUIRE us to keep our assets perched in this precarious state. This is second in importance to global economics only to a Japanese China Syndrome with “criticality”.

  5. and in case you are wondering, this is tied to foreclosure because these types of scams could not be perpetrated on us unless we have the system of debt that we have in the US of A. central banks control over 120 countries worldwide and by that I mean the governments, which in turn means the people of those countries.

  6. the fed…the fed…the fed!!!every single issue in the United States of America is tied to the fed and how it creates money, which creates debt, which in turn creates inflation. Until we rid ourselves of the current monetary system which is nothing more that the slow but sure destruction of our Republic, which is exactly what they want because otherwise we would be free to do what we want and not what this small group of elitist international “banksters” want, these types of crises will continue as they are how they transfer wealth. please go to http://www.silentnomorepublications.com/Money/Home.html and learn what is really going on.Every politician that does not denounce the fed is a traitor to this country and to the people he/she profess to serve. we need an honest currency!!!!!!!

  7. I mean when you consider I have not paid my mortgage in 1 year now, and same for the second on it, HELOC, I have not been foreclosed on. With our new servicer, of a year ago, I have written them asking them to prove they are entitled to collect on the mortgage. I have received a letter back with copy of the note and stating Fannie Mae is beneficary. But yet no proof that the servicer is entitled to collect from Fannie Mae. Here we are one year and no payment by me. You’d think if somebody was really out money on their investment in our mortgage they would be all over it, don’t you think?

    And a friend in the same town as me has not paid for 2 years now? You’d think the mortgage note holder would be all on it trying to get the house performing as payments due or foreclose?

  8. I’m beginning to wonder if default home mortgage is the same shit as default CC debt. In other words, if you engage and say I owe the debt and lets work out a deal via modification or try to prove it all, it is the same as creating a new contract with servicer who really is just a debt buyer.

    Any comments?

  9. oh, don’t pick up the phone, read comments:

    “Fast forward to a couple months ago—I received a phone call from a debt collector that immediately started out with a very aggressive, threatening tone. I had not seen any paperwork on this “alleged” debt– and what the persons (I asked to talk to her supervisor) were doing were trying to get a verbal agreement for payments, which is binding in CA. ”

    Key is verbal agreements on defaulted CC debt. Hence why I don’t care if these yahoo’s call me forever, and I laugh at their buying debt for pennies on the dollar and sucking people into their scam. I really wish all knew the truth. I get a letter every month from these yahoo’s trying to get me to “AGREE=Contract” to a settlement of the default CC debt of 120k for several cards between myself and my wife. Sorry you scum suck’in pigs, you ain’t gonna get a dime from this Cowboy.


  10. oh, here’s NCO Group, largest collection company, note further down JP Morgan involvement:


  11. Follow the Money: How Systemic Bank Fraud
    Contributed to the Financial Crisis


  12. It sounds like JPM Chase was into its own form of the Mortgage Backed Securities Ponzi scheme. It is really the same scam. Sell people worthless securities (stocks, bonds, mortgages, etc.) that they know will fail, and then rake in the money on the (foreclosed or other debt) from the other side of the debt (homeowners, insurance companies). Burmese8@yahoo.com

  13. SWARM the BANKS ,

    Not all of those $50 unverified CC donations were prepaid gift cards with a Visa or MC logo ,, a huge amount was from identity theft and stolen CC’s to verify with a small untraceable purchase if a card was still active… the majority of the rest were purely subversive “gifts” from eastern european countries that wanted our country to be headed by a “fellow traveler”.

    The reality is Jamie Dimon , George Soros and all the GS alumni own our government.

  14. Swarm, everyone you’ve referred to is “on the same team”. You have to ask why people would support yet another sell out, corrupt, duplicitous public figure, who married off her daughter to a Goldman Sachs profiteer and who happens to be a woman. Get real, who wants that for the next bought and sold selection round of 2012?

  15. Barack Obama admires Jamie Dimon. Dimon, Winfrey and Obama all have their business roots in Chicago.

    You shouldn’t criticize Dimon while liking Barack Obama. Obama engineered the biggest pre-paid credit card donation swindle ever perpetrated during a presidential campaign.

    Wall street wanted Barack Obama, not Hillary Clinton, because Hillary Clinton did not have any puppet strings attached to her.

    Hillary Clinton can’t win in 2010 because cable news reporting is intentionally decisive, pushing people into either supporting MSNBC and Barack Obama, or Fox News and the republican candidate.

    Ironically, there is a huge swath in the middle of Hillary Clinton supporters who have been disregarded and marginalized.

    Until we have a cable news network that is not as polarizing as either Fox or MSNBC, nothing will “change”.

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