Additional questions for Jamie Dimon

Questions for Jamie Dimon that no Member of Congress had the Courage to Ask

Trustee Giddens reports (page 131) that two employees of JP Morgan, Fernando Rivas and Barry Zubrow, called Jon Corzine regarding the $175 million they owed to JPMorgan-UK.  Are you aware of that call? Did they make it on your orders? According to Giddens, your employees threatened to stop handling MF Global’s asset sales until JPMorgan got its money back. It seems that you were willing to push MF Global over the cliff unless they wired the money to you immediately.

Is that the standard way that JPMorgan does business? Do you think that threat was a factor in MF’s decision to reach into customer segregated accounts to come up with the money?

When was the last time that you personally spoke with Mr. Corzine? Did you speak with him during the last two weeks of October, last year? Did you ever say anything to him that might be interpreted as a threat if MF Global caused losses at JP Morgan?

Mr. Corzine told our Committee under oath last December that he never directly ordered that money be taken from customer accounts to satisfy MF’s debts to you. Given that MF Global was in a desperate battle for survival and desperately trying to raise cash during the last week of October, do you think it would have been reasonable for him to think that suddenly MF Global had hundreds of millions of dollars in excess cash sitting around that they could wire to you? The total amount of customer money that is now missing, $1.6 billion, is equal to more than one and a half times the total net worth of MF Global as reported on their last financial statements. Would it be reasonable for a CEO to lose track of 150% of the value of his entire company? If, in fact, he didn’t ask about where the money was coming from, could it be that he it was because he didn’t really want to hear the answer, or already knew the answer? Isn’t this a classic example of WILLFUL BLINDNESS?

5) Did any JPMorgan executives or attorneys participate in any way with the discussions or process involved in structuring the MF Global bankruptcy, including the decision to allow MF Global Holdings to continue operating under Chapter 11? Did anyone from JPMorgan, or representing JPMorgan, participate in the big conference call in the early hours of the morning of October 31 where those decisions were made? Was JPMorgan represented at the November 1 hearing where the Chapter 11 petition was approved?

 6) You have been a Director of the NY Fed since 2007, is that correct Mr. Dimon? Did you find it strange that, despite its small size and undercapitalization, MF Global was suddenly given Primary Dealer status by the NY Fed shortly after the arrival of Mr. Corzine? Prior to his arrival, MF Global’s application had been rejected, isn’t that correct? Do you think that the fact that Mr. Corzine was an old friend and colleague of Fed President Dudley, and has lots of friends in high places here in Washington, might have had any influence on that decision? Did you raise any objections to it, or warn the Fed about the weakening financial condition of MF Global in 2011? If not, didn’t you have a duty to do so in your capacity as a Fed Director?

7) As we sit here today, MF Global’s customers, many of whom had their segregated accounts at your bank, are still waiting for restitution of the $1.6 billion illegally transferred from those accounts. Who do you think is responsible for that? Should anyone be held accountable? Mr. Corzine, you, regulators??? Do you think that prison time would act as a good deterrent to this kind of thing happening again???

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