Journalism in the Public Interest

Charting the Cozy Connections between JP Morgan and the Senate Banking Committee

Jamie Dimon, CEO of JP Morgan Chase, testified today about the bank’s recent losses. He should be familiar with the committee. Lots of his employees worked for it. 

Jamie Dimon, chairman of the board, president and CEO of JPMorgan Chase & Co. testifies before a US Senate Banking Committee full committee hearing on June 13, 2012 on Capitol Hill in Washington, DC. (Photo credit: KAREN BLEIER/AFP/GettyImages)

This morning, Jamie Dimon, the CEO of JP Morgan Chase, faced a Senate hearing over more than $2 billion in bank losses caused by risky hedges that blew up. Dimon said that the hedges—investments meant to protect the bank—had grown into “complex and hard-to manage risks.” The losses “let a lot of people down, and we are sorry for it.”

Many lawmakers are holding up the losses as evidence of the need for stronger financial regulation. The chairman of the Senate banking committee, Tim Johnson, D-S.D., in his opening remarks, asked for “a full accounting” of JP Morgan’s losses.

But through campaign contributions and well-connected staff, JP Morgan appears to have already taken its own accounting of the Banking committee. Here’s a picture of connections between the company and the committee:

Revolving Door

One current staffer on the Senate banking committee, Dwight Fettig, is a former lobbyist for JP Morgan. In 2009, the bank hired him to work on “financial services regulatory reform.” Meanwhile, JP Morgan is stacked thick with former committee staff.

· Naomi Camper – Currently a lobbyist for JP Morgan. Prior to that, from 2001-2004, she was an aide to Senator Johnson.

· Kate Childress –A JP Morgan lobbyist since 2008, she is also a former aide to Chuck Schumer, D-N.Y., who sits on both the Senate Banking and Finance committees.

· Steven Patterson –A JP Morgan lobbyist and formerly a staff director for economic policy for the Banking committee.

· Nate Gatten— A JP Morgan lobbyist based in London who was reportedly called back to Washington recently to help with the company’s damage control. He is a former lobbyist for Fannie Mae, and, in the 1990s, was a banking aide to former Senator Robert Bennett, R-Utah, who also sat on the committee.

· P. Michael Nielsen – A lobbyist with a firm run by former Senator Bennett, he has been retained by JP Morgan for help with federal probes, according to Bloomberg. He was also a senior policy adviser to the committee from 2007 to 2010.

American Banker also reported that three other outside lobbyists currently working for JP Morgan were once affiliated with the committee:

· Jason Rosenberg – A lobbyist at The Glover Park Group and formerly an aide to Jon Tester, D-Mont., who sits on the committee.

· Jenn Fogel-Bublick – A lobbyist at McBee Strategic Consulting and formerly a Democratic counsel on the committee.

· Mike Chappell – A lobbyist for Fierce, Isakowitz & Blalock and a former press assistant to Senator Roger Wicker, R-Miss., another committee member.

A former senator on the committee, Mel Martinez, R-Fl., is also now the JP Morgan exec in charge of Florida, Central America, and the Caribbean. Martinez was elected to the Senate in 2004 and went to the bank in 2010. Bloomberg reported that he was called to Washington after the losses were reported.

Lobbyists for JP Morgan appear to be keeping busy. The bank spent $7.6 million on lobbying last year, according to the Center for Responsive Politics.

Campaign Contributions:

JP Morgan has also been a generous donor to banking committee members, both Republican and Democratic.

· JP Morgan is the second largest campaign contributor to Johnson, the committee chair, and to the top Republican on the committee, Richard Shelby of Alabama, over the past twenty years, according to a tally from American Banker.

· JP Morgan employees have donated more than $80,000 to Johnson since 1998 and more than $136,000 to Shelby since 1990.

· So far in 2012, Dimon has personally donated to committee members Bob Corker, R-Tenn., and Mark Warner, D-Va. In 2008, he gave $2,000 each to Johnson and Shelby.

· Six of the 22 members of the banking committee have not received any money from JP Morgan PACs or employees in recent election cycles. Two of those members are retiring and aren’t collecting campaign funds.

It’s not clear what the committee will do beyond the hearings. Numerous federal agencies are investigating JP Morgan’s losses, including the Commodity Futures Trading Commission, the Office of the Comptroller of the Currency, the Department of Justice, and the Securities and Exchange Commission. Next Tuesday, Dimon will testify in front of the House Committee on Financial Services.

The Dimon Hearing was a total joke and is an example of the corruption that exist throughout the congress.

“It’s not clear what the committee will do beyond the hearings”  Maybe they just have a good old fashioned black tie cocktail party and catch up on old times.

Richard Polonsky

June 13, 2012, 3:52 p.m.

The revolving door of former legislative staff lobbying the regulatory agencies and Congressional committees that they once worked for is a travesty. Can the American public expect anything more from Congressional members than condolences to the banks for getting caught?

Government of the rich…
For the rich…
By the rich.

Why would anybody send their kids to fight to perserve this sick oligarchy? Not me. Not ever.

Our research of financial disclosure forms shows that at least 18 of the 22 committee members are investors in JPMorgan:

Phillip Vail ... I totally agree.  Our government is sick and needs serious overhauling which would take a constitutional amendment and does anyone think that congress would propose an amendment that would kill their golden goose?  Even to save the nation?  Not likely.

If you’re in a poker game and you don’t know who the sucker is…it’s you

It’s unlikely the majority of uninformed voters will ever read anything about this travesty. Heck, most can’t name our Vice President.
With razor-thin elections, ‘we few’ do have the opportunity to institute much needed ‘term limits’. Vote all Demopublicans out after 1-term/Senate 3-terms/House. Got to get them out of DC before they find the ‘Money-Teat’.
I do not care if the candidate turns-water-to-wine; if they’re a lawyer, I’ll cast my vote for Fidel Castro instead…

Outrageous, but hardly surprising.  Keep up the good reporting, though.  Maybe people will wake up ...
if it’s not too late already.

Less than a third of the banking committee membership hasn’t been directly bought off? And 4 of 22 members don’t own J P Morgan Chase stock? How did these members manage to slip through the corporate net? I’d love to know who they are and confirm my suspicions that they’re probably all Democrats.

Much is being made of the actual dollar loss to JPM But the big story is the billions lost in investors portfolio value .The fact that JPM has reserves and will still make profits is dwarfed by the loss of confidence in the firm and industry. Jamie Dimon saying they made stupid mistakes is unacceptable ,JPM is not a 1 person firm it seems to me that because of employees protection of their own pay package they just looked the other way. If they lucked out and the highly risky trade worked out we would have never heard about it. It is the utter disregard for risk management at this time after the almost total collapse of our economy that is shocking. American lifestyles and saving and futures are at stake . Right now it seems we are still in an anything goes situation, the cardinal rule is to just not get caught.

Great information.  This needs to be explored for all committees.

It’s hilarious to hear a multi-billion dollar investment company say “Oops, we had this product that was supposed to be safe.  Who knew?”

It’s basically saying that they don’t know their business.  Does this mean JP Morgan’s banking licence should be revoked?

In the meantime, anyone who has received some form of remuneration from JP Morgan should remove themselves from the proceedings.  Whether that remuneration was as an employee, contractor, or as a politician seeking campaign funding.


June 14, 2012, 5:29 a.m.

Yes, individuals who have personally received more than $2,000 should recuse themselves from the situation.  These same people should recuse themselves if they have enabled more than $2,000 to be paid to others, or if their firm’s received more than $2,000.  These are very basic standards about conflicts and for the correct operation of law.  By not doing so, or by insisting that their situation is different, these individuals are jeopardizing confidence in the very system America supports.

No wonder Dimon came across so confident before, during and after the hearing.  Since all the participants work for him, I am certain he knew all the questions before they were even asked.  What a joke.

A Country Club meeting of a banker with his enabling Senators exchanging niceties - the only thing missing - Single Barrel Wiskey! Cheers to all friends of Wall Street ...

I heard many members of the committee were not in attendance. Anyone know who they were?

Let Jamie take one for the team and resign.

And the list above only reflects the JP Morgan connections.

THE INCONVENIENT TRUTH: So what is the latest with OUR Senate Banking Committee that is suppose to be protecting our taxpayer economic well being by monitoring Wall Street?  Did you know that our boys on the committee that were throwing soft ball questions of to Mr. Dimon, had no idea about what federal bank regulations had been violated and were asking him what rules he wanted to play by! These clowns have been taking $580,000 from JP Morgan because they supported Financial De-regulation! The Larger takers are Senator Shelby, Crapo, Vitter, Corker, DeMint, Toomey, Johanns, all these political whores are republicans, except for Johnson the Chair is a democrat! And there is more, there are now 8 past staff that worked on our dime for Senate Banking Committee that now work for JP Morgan! And there is still more! Mr. Mel Martinez, retired republican senator for Florida that was on Banking Committee works for good ole Jamie and JP Morgan!  We are in deep Shit trouble with these guys taking care of business!
KEEPING IT THOUGHTFULLY HONEST: Do you know that Mr. Dimon was given a pass when he was allowed to lie to during the Senate Banking Committee when be questioned under oath! One Example was when he was asked his opinion about new Volcker bank regulation! He said he was not familiar with it! Yet, it has been reported that he has been working for months with his JPMorgan lobbyists against the Volcker Reg. And since Mr. Dimon, the CEO of JPMorgan sits because he is an informed expert on the National Federal Reserve to regulate himself! Huh?

david alan kjoller

June 15, 2012, 3:54 a.m.

As I read some of the comments, there is a common thread that runs through the majority of them.  Phillip Vail probably captures my sentiments the best.

We grow up learning the wonderful aspects of American government. But in time all of that becomes just so much drivel.  Of all the disparaging words I could use, I condense it into—our government for the most part is a joke.

The inordinate control of the Federal government by corporate influence, which means money, is not likely to change for a long time, so long that its not worth contemplating.

There is a point at which even the lofty and eloquent words of a Ronald Reagan rings hollow.  That’s where we are.

I leave it there.

This whole process is an insult to
America, have they no shame?

David, unfortunately, this is what happens when we (myself included, I’m ashamed to say) get disillusioned and TURN AWAY.

Why?  Because the corrupt people won’t turn away.  Given the choice between listening to a lobbyist and listening to a population who won’t talk to you except to call you names, who would you lend your ears?

I don’t think it’s too late, but the road ahead is the hardest one.  We all need to keep in contact with our legislators, letting them know that we’re invested in this country’s future more than Wall Street, Hollywood, OPEC, or Shenzhen.

(Really, think about how many times a friend has told you that they watched some half-assed YouTube video and it changed their outlook on an issue.  Now imagine people just like that in charge of the country, and the honest people won’t talk to them.)

Yes, I’m sure a bunch of them are thoroughly corrupt.  But if there’s any chance that a few of them are looking for an excuse to buck the system…

This is why I and so many of my friends are leaving the u.s. “for a better life.” We live in a land of thieves and crooks that prey on others for their superficail material life. And not only are they destroying good people’s lives…they are destroying the environment as well.
When you have a culture that refuses to honor an interior life of conscience, compassion and love are thrown out. America is no longer safe, no longer honorable, and no longer worth living in.
I hope you can escape before it gobbles you up.

I’m not understanding why Jamie Dimon has to go in front of congress?? JP Morgan lost 2 billion dollars of their clients money in the market…. uhm this is private money, private investment, no crimes have been comitted. JP Morgan’s clients are out 2 billion dollars, but thats their own fault for taking on the risk of letting others manage your money.

Again, nothing illegal took place, you invest money, the bet goes bad, you lose, thats the nature of investing, why is congress involved?? IF you want to look into a crime, how about investigate Solyndra, where OUR money was stolen from us and intentionally thrown down the drain on terrible investments that the president KNEW would fail…. At least JP Morgan lost private money, NOT PUBLIC money aka US, the Taxpayers.. Solyndra is the real crime.

Corey this case is much bigger than a simple case of losing your own 2 billion.  read all the editorials in Ft And WSJ plus my own comments posted june 13at 9:41 pm.

New effort to reform the fed co-sponsored by Barbara Boxer and Bernie Sanders: google: “democracy for America real fed reform now”

Bill Moyers latest show, “Dark Money in Politics” discusses the non-transparent super pac cash flow - including to members of the fed and Dimon’s cozy relationship with the “regulators”.

There is a R.I.C.O. Act that all of these guys need to be arrested for, Congress, Senate, Large Firms, and just get some Integrity.

Corey, another way of looking at the events is that the banks arranged a large number of loans for failure, made money on the insurance (and debt collection, and foreclosure), screamed that they needed government money or the economy would crash (including threats of widespread rioting and martial law), and continue to blame the victims.  In the process, people were “processed” through eviction proceedings, many of which were illegally handled, for example, by not proving that the bank was owed anything, and the country’s economy has been severely damaged.

None of that might be illegal, but don’t you think Congress should be checking out attempts to collapse the economy or accidents that might produce the same result?  They are responsible for interstate commerce, last I checked, and this seems at least as interesting as blowing up random Arabs (sorry, “Islamic militants”) with drones or musing on whether athletes take steroids.  After all, they might (they won’t, but they might) amend laws that could prevent an actual collapse in the future.

They played softball with Dimon to the point where it wasn’t worth bringing him in, as the article points out.  However, even under those conditions, even he called his company’s actions indefensible, so perhaps there’s something to it.

But sure, focus on half a billion “Taxpayer Dollars” (that’s a buck seventy per American, or alternatively, a loss we could recoup by not paying Congressional salaries for seven years) rather than what’s anywhere from a near-fatal disaster to a coordinated attack on the country.

(I agree that Solyndra was a problem, but the problem is that government backing is apparently unconditional.  The deal should have been that any Intellectual Property they owned goes to the American people to build on.  That’s win-win.  As it stands, someone got the money and for another fifteen years or so, if they have a patent, some private individual either gets the benefit or can block progress.)


June 18, 2012, 1:35 p.m.

Corey, Without notifying homeowners, the banks arbitrarily changed their underwriting standards and are making many consumers pay significantly more money to the bank, at significantly higher margins, than the mortgage industry has ever earned in the past.

While enforcing what the banks think is their “right,” they proceed to steal the “equity” that homeowners own in their property because their documents now say they are permitted to do this. 

I hope some judges start to understand the anti-competitive behavior this entails and that they start to enforce existing antitrust laws so that homeowners are reimbursed for past payments that are out of line.


June 18, 2012, 3:37 p.m.

Someone asked me what I meant by “steal.”  The way the foreclosure mechanism works is that the court allows for an auction sale.  The bank and its staff is aware of the sale.  Either related individuals in other parts of the bank organization, or “friends,” learn that a foreclosure sale takes place (They are available on Bloomberg).  On the date of the sale, these “friends” buy the note, with bids that start at 50% of the value of the note, and flip the property to a new owner, or sometimes right back to the original defaulting homeowner.

These “friends” earn the capital gain.

Whatever happens, a forced “auction” sale involves a discount to Fair Market Value of at least 20%, maybe 25%.  In the situation where someone has a $500,000 mortgage on a home they may think is valued at $750,000, the 20% discount means $150,000 of cash the homeowner no longer receives.

Add to this two years of high - cash-flow sucking - interest payments, property taxes, monthly costs to maintain the property and the homeowner is wiped out of the “equity” he otherwise “owned” in the property.

Remember, the defaulting homeowner is having the liability “legally” accrue against him at either the original high pre-2008 rate, or at the 2% re-set rate limit!  This all happens because the bank arbitrarily changed their underwriting standards and does everything to continue to collect the “servicing” fee they negotiated for themselves and which they did not disclose on the original HUD closing statement.

Yes, it is anti-trust theft and the amounts they take is statistically significant to the tune of three standard deviations above historic norms that have existed since 1989.

The deference shown by Senators - bowing & scraping - cream puff questions “what would you do, Mr. Dimon”.  “What do you advise we do, Mr. Dimon” was both disgusting and frightening.  Is there any hope for our national future w/ this bunch of ole boy back-slappers in place?

Dimon’s out to make money—and so are they!

While not a direct employee of JP Morgan, you should include Peter Roberson on your list.  Mr. Roberson joined the House Financial Services Committee directly from what was then called “The Bond Market Association”. 

Mr. Roberson was hired by the House Financial Services Committee during the financial crisis and was literally “Put in Charge” of writing the new legislation for the bond market.  As such the Banks had placed one of their own Foxes as the senior guard of the Hen House.

Bob Lamberson

June 20, 2012, 9:53 a.m.

Now that all of this corruption is revealed, when do the persons involved get held accountable, and when do changes get made to correct the imoral,if not illegal actions??

Great reporting, but what about somw energy devoted to change!!!

In America people are free.  That’s why we love our country and that’s why lobbyists are free to talk to politicians and politicians are free to become lobbyists.  Our Constitution, otherwise one of the world’s most well thought out documents, allows us this freedom. 

As smart as they were, our founding fathers failed to foresee that without term limits Congress would become a Roach Motel and corporate money would become the secret sauce that let the members check in but never check out.

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