I recently posted JPMorgan manipulated CA’s energy market to great profit, lied about it. Penalty? Chump change (1 day’s revenue). Please link over, because Michael Hiltzik's take is worth a read.
With that, here are today's Los Angeles Times letters to the editor, because our voices matter:
Why do we so seldom hear about any of these hundreds of guilty market manipulators — all cherished employees of large corporations — going to prison? They never admit any wrongdoing, and seldom do we see their heads bowed to express shame as destroyers of America's social contract.
Michael Hiltzik reminds us that a $421-million fine is pocket change to JPMorgan Chase & Co. against total annual net revenue of $97 billion. No wonder its spokesman is "pleased to put this matter behind us."
Contrary to what federal regulators say, this ridiculous slap on the wrist will never be a strong deterrent to continuing big-money corruption. Nor will it result in any "material impact" on the secretive culture of yet another Wall Street giant that exalts profit over morality — at the expense of the rest of us.
JPMorgan's manipulation of energy markets is nothing short of criminal.
The fact that no one will go to prison for this crime, and that the manipulators see fines as the cost of doing business, reminds me of my childhood in San Francisco, where the bookies to whom I sold newspapers told me they weren't worried about being arrested for illegal gambling; they just paid the fine and came back the next day, where they cooked the books once more — or paid off the arresting officer.
That area of San Francisco was called the Tenderloin District. It seems we have our own Tenderloin, but on a national level — it's called "investment banking."
San Juan Capistrano
I think of myself as an informed citizen. After 68 years of life, I am starting to think "the fix is in."
Major corporations — contributors to both parties — write the rules for their benefit. Politicians are now professionals, not citizens doing their civic duty like our founders envisioned.
As Will Rogers said, we have the best politicians money can buy.
Michael Hiltzik nailed it again. His column in today's Los Angeles Times pointed out what TV news shows fail to mention: Once again, Corporate America skates and the little guy can't do a thing about it. Or as I like to call it, injustice.
JPMorgan Chase was fined $410-million for manipulating energy markets in California and the Midwest. Period. That's it. No arrests, not a seriously "historic" penalty, no deterrent to speak of, just a measly few hundred million for ripping us off. Seems like a lot to the rest of us, right? But to them? Pfft.
It's chicken feed. A pittance.
It will have no more deterrent effect on white-collar wrongdoing at JPMorgan or anywhere else than telling its traders they've got to take the Ferrari to work instead of the Lamborghini, though they can still take the Lambo to the beach house. Our top regulators actually think they've gotten the better of a huge illegal enterprise, which is a good sign that they're delusional. They didn't even get Morgan to admit that it had done anything wrong.
Look at the numbers. Of the $410 million, $125 million represents the disgorgement of illicit profits from Morgan's scheme — money the bank wouldn't have collected at all if it operated within the law. (The sum is supposed to be returned to ratepayers.) So that doesn't count. The real punishment is the balance of $285 million. How badly will that hurt JPMorgan Chase? Well, the big bank collected $97 billion in net revenue last year, so it represents a little more than a single day of intake... [T]here's no indication that these individuals will suffer any consequences for this rip-off. They're not the ones paying the penalties; Morgan's shareholders are. [...]
As the FERC documents make clear, Morgan was worse than Enron — because despite the lessons of Enron, it engaged in this manipulative behavior anyway.
But just when I thought Hiltzik's analysis couldn't possibly get me any angrier, he added this at the end:
The only remedy is to take the market out of the electricity business, returning to the regulated utility model that served American ratepayers for decades. The markets clearly don't work to consumers' benefit, because the regulators can't handle the task of staying ahead of the gamers.
The question is, do they even want to regulate? FERC Commissioner Clark praised Tuesday's settlement ... [and] pointed out that by settling, the government closes the case "without expending further resources."
Is that what we pay our regulators for — justice on the cheap? JPMorgan's behavior was disgusting, but FERC's decision to let the bank get off for pennies on the dollar is inexcusable.
Please read the entire column, and please share it with FERC. They might learn something.
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