Aug. 20 - Legal woes continue to rise for JPMorgan Chase and its CEO Jamie Dimon including allegations of energy manipulation and bribery in China. Conway G. Gittens reports.
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When you get a reputation as the best run bank during a financial crisis....you better make sure the name sticks.
That's been a post-crisis problem for JPMorgan Chase and CEO Jamie Dimon.
The latest potential black mark on the bank's record: manipulation. The Justice Department is probing whether JP Morgan interfered in U.S. energy markets, according to the Wall Street Journal, citing people familiar with the case.
This is not the first recent run-in with regulators over the energy market. It has already agreed to pay hundreds of millions of dollars in penalties and givebacks for a separate settlement with energy regulators for allegedly manipulating the power market.
And the bank is still not in the all clear for the mortgage mess behind the financial crisis.
The problems are not just at home. Sources say the bank is facing a China bribery probe by the SEC, which is looking to see if the bank gave jobs to children of powerful business leaders in the communist party in exchange for lucrative investment banking deals.
At the same time, Dimon is still facing backlash over the "London Whale" trading scandal, which cost $6.2 billion and almost took away one of his titles of Chairman and CEO.
Adding it all up - there are at least a dozen probes and investigations being conducted by federal, state, and even foreign governments.
And speaking of adding up - it has about $5 billion a year for the last two years in legal fees, and a secret stash of cash for a legal fund may not be enough. According to the bank's admission it may need $7 billion more to pay for all its legal woes.
But there's a lot of pad in the cushion. Despite all the legal issues, Dimon presides over a bank that took in a record profit of more than $21 billion last year, which may buy him some time before investors start calling for his head.
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