Comments on JPMorgan666: JP Morgan's Bribery Problem

JP Morgan “Don’t Panic...No One’s Going to Get Scr...

2010-08-03T16:20:25.304-04:00

JP Morgan “Don’t Panic...No One’s Going to Get Screwed”

http://tinyurl.com/294lmnp

FSA Hands J.P. Morgan Record Fine LONDON—The U.K...

2010-06-03T09:48:15.675-04:00

FSA Hands J.P. Morgan Record Fine

LONDON—The U.K.'s Financial Services Authority said Thursday it has fined J.P. Morgan Chase & Co. £33.32 million ($48.8 million) for failing to separate client money from the firm's money, in the largest fine in the FSA's history.

The market regulator also warned firms that it has more cases in the pipeline, urging them to ensure their internal controls over client money separation are in place.

The FSA said J.P. Morgan Securities Ltd. didn't follow the rules by keeping client money held by its futures and options business separated from the firm's own money between November 2002 and July 2009.

It said that during that period, the client money balance held by the business varied between $1.9 billion and $23 billion. The error, which was discovered last July, occurred following the merger between J.P. Morgan and Chase, and wasn't deliberate, the FSA added. Clients didn't lose any money and the mistake didn't result in any incorrect financial reporting, the regulator said.
"Had the firm become insolvent at any time during this period, this client money would have been at risk of loss," the FSA said in a statement.

The company "committed a serious breach of our client money rules by failing to segregate billions of dollars of its clients' money for nearly seven years. The penalty reflects the amount of client money involved in this breach," it added.

A J.P. Morgan spokesman in London declined to comment.

"This is a staggering fine for what is in effect an administrative oversight," said Simon Morris, a partner at London law firm CMS Cameron McKenna. "If this doesn't serve to wake up every senior manager to check that he or she has carefully identified all risks and is properly managing them, then nothing will."

The FSA's latest enforcement move comes as the agency continues to face pressure to prove that its existence is essential for the U.K.'s financial health. The agency, which has a toothless reputation, was nearly abolished following national elections last month. But the new government coalition decided to keep it.

In the statement, the FSA said it has created a new unit covering client money and assets, and warned that it has "several more cases in the pipeline."

"Firms need to raise their game as the FSA's focus on this area will continue to intensify," said Sally Dewar, FSA managing director of risk.

J.P. Morgan received a 30% discount on the fine for agreeing to settle the issue at an early stage, the regulator said. Without the settlement discount, the fine would have been £47.6 million, the FSA said.

Previously, the largest fine handed down by the FSA was a £17 million fine against Royal Dutch Shell PLC in 2004 for market abuse.

Silver Short Squeeze Could Be Imminent FORT L...

2010-04-05T10:27:38.662-04:00

Silver Short Squeeze Could Be Imminent

FORT LEE, N.J., April 3, 2010 /PRNewswire via COMTEX/ -- The National Inflation Association today issued a silver update to its http://inflation.us members: On December 11th, 2009 NIA declared silver the best investment for the next decade. In our December 11th article, we said that it wasn't a coincidence that the very day Bear Stearns failed was the same day silver reached its multi-decade high of over $21 per ounce. We went on to say, "The reason why we believe the Federal Reserve was so eager to orchestrate a bailout of Bear Stearns, is because Bear Stearns was on the verge of being forced to cover their silver short position." JP Morgan took over the concentrated short position in silver from Bear Stearns and gained complete control over the paper price of silver. Within weeks, JP Morgan was able to manipulate the price of silver down to below $9 per ounce.

NIA believes they were able to drive the price of silver down through "naked short selling," selling paper silver that is unbacked by physical silver.

NIA believes the precious metals markets are currently being artificially suppressed by paper gold and silver that doesn't physically exist. At last week's CFTC hearings, Jeffrey Christian of the CPM Group admitted that banks have leveraged their physical bullion by 100 to 1. This means for every 100 ounces of paper gold/silver that trade, there could be as little as 1 ounce of physical gold/silver in the vaults backing it. However, Mr. Christian sees no problem with this because he says "it has been persistently that way for decades" and there are "any number of mechanisms allowing for cash settlements." What Mr. Christian fails to realize is, most investors around the world holding paper gold/silver believe they own physical gold/silver. There will come a time when these investors don't want cash settlements in U.S. dollars, but they will want the physical precious metals themselves. When investors around the globe eventually call for physical delivery of their precious metals, NIA believes it will result in the biggest short squeeze in the history of all commodities.

http://www.cnbc.com/id/36160274

There are two kinds of bankers to fear. The first...

2010-04-03T18:08:04.746-04:00

There are two kinds of bankers to fear. The first is incompetent and runs a big bank. This includes such people as Chuck Prince (formerly of Citigroup) and Ken Lewis (Bank of America). These people run their banks onto the rocks – and end up costing the taxpayer a great deal of money. But, on the other hand, you can see them coming and, if we ever get the politics of bank regulation straightened out again, work hard to contain the problems they present.

The second type of banker is much more dangerous. This person understands how to control risk within a massive organization, manage political relationships across the political spectrum, and generate the right kind of public relations. When all is said and done, this banker runs a big bank and – here’s the danger – makes it even bigger.

Jamie Dimon is by far the most dangerous American banker of this or any other recent generation.

Not only did Mr. Dimon keep JP Morgan Chase from taking on as much risk its competitors, he also navigated through the shoals of 2008-09 with acuity, ending up with the ultimate accolade of “savvy businessman” from the president himself. His letter to shareholders, which appeared this week, is a tour de force – if Machiavelli were a banker alive today, he could not have done better.

http://tinyurl.com/ydl6sjf