Better Markets, a nonprofit, nonpartisan group promoting the public interest in financial reform, today in a letter to Attorney General Eric Holder called for the appointment of a special counsel in connection with the multibillion-dollar trading loss at JPMorgan Chase & Co. to avoid conflicts of interest and ensure public trust in the American judicial system.
“With Americans distrustful and suspicious of government and Wall Street, particularly in light of the government’s multi-trillion dollar bailout of Wall Street while Main Street suffered, it is imperative that an independent, thorough, and full investigation of the largest, most powerful, and most politically connected bank in the country be conducted expeditiously by an unconflicted Special Counsel,” wrote Better Markets President and CEO Dennis Kelleher.
The letter details why an investigation by the Justice Department into JPMorgan and its CEO Jamie Dimon would create a series of conflicts of interest, as well as the overall suspicion that the administration cannot and will not conduct a full, fair and complete investigation. A few of the reasons justifying an appointment include:
• President Obama prejudged the ongoing investigations and essentially exonerated JPMorgan and its CEO Jamie Dimon when he stated in his May 19 radio address that the massive trading losses at JPMorgan were merely “a big mistake at one of our biggest banks.” The president also narrowed the scope of the harm, describing it as a “two billion dollar loss,” when recent reporting indicates it could exceed $5 billion.
• The president, according to one report, regards Mr. Dimon as one of his “favorite bankers.” After revelations of the bank’s highly questionable trade, the president still described Mr. Dimon “as one of the smartest bankers we got” and JPMorgan as “one of the best-managed banks there is.”
• The president was widely reported to have considered Mr. Dimon for nomination to be his Treasury secretary.
• Mr. Dimon and JPMorgan employees contributed more than $800,000 to President Obama’s 2008 political campaign. Mr. Dimon personally contributed $50,000 to President Obama’s Inaugural Committee. In addition, Michael Cavanagh, recently designated by JPMorgan to lead an internal investigation into the $2 billion trading loss, served as a “bundler” for the 2008 Obama campaign, raising between $50,000 and $100,000.
“The public interest in getting the truth, determining whether any laws were broken, and holding those involved accountable could not be higher. Furthermore, ensuring that the American people have full confidence in the investigation is equally critical. Many question whether there is a double standard in this country: one set of laws for the large, well-connected, and powerful Wall Street banks and one set of laws for everyone else,” Mr. Kelleher wrote. “This is the backdrop against which any consideration of the appointment of Special Counsel must be considered.”