Sneed exclusive: Ald. Leslie Hairston wants city to stop doing business with Chase
BY MICHAEL SNEED January 14, 2014 9:10PM
(FILES)The headquarters of JP Morgan Chase on Park Avenue December 12, 2013 in New York. US banking giant JPMorgan Chase reported a 7.2 percent drop in fourth-quarter earnings January 14, 2014 as it seeks to move past a regulatory onslaught in an improving US economy. JPMorgan, the largest American bank, said earnings were $5.3 billion on revenues of $23.16 billion, down from $5.7 billion on revenues of $23.65 billion in the year-ago period. The results included another charge related to legal settlements. AFP PHOTO/Stan HONDA / FILESSTAN HONDA/AFP/Getty Images
Updated: February 16, 2014 6:37AM
Is Chase being chased out of Chicago?
Ka-ching! The scandal-ridden JPMorgan Chase bank, which has been slammed with steep payouts because of government probes, may have a new headache on its hands.
Sneed has learned that Ald. Leslie Hairston (5th) plans to introduce a City Council ordinance Wednesday deleting the bank from its list of 19 designated financial heavy hitters.
◆ Translation: Hairston wants to stop the city from using JPMorgan Chase as a municipal depository.
Sneed is told about $350 million in city municipal funds are now deposited with Chase.
“The bank has violated the city code by making admissions of dishonesty and deceit in the way they dealt with their investors in the mortgage securities and Bernie Madoff Ponzi scandals,” Hairston told Sneed.
“We use this code against city contractors and all the small companies, why wouldn’t we use this against one of the largest banks in the world,” she said.
“It’s bad enough the penalties imposed against them by the feds don’t really pinch them because they are able to pay off the fines levied against them.
“What we have to do is correct the bank’s behavior . . . and this ordinance hopefully will help that along,” Hairston said
The bank, led by embattled CEO Jamie Dimon, has been the target of two major banking scandals. They resulted in:
◆ 1) A $13 billion settlement with federal and state agencies over misrepresentations related to the sale of mortgage securities in the run-up to the nation’s financial crisis.
◆ 2) A $2.6 billion payment to federal prosecutors and regulators for alleged failure to warn authorities about the fraud perpetrated by their client, Ponzi scheme king Bernard Madoff.
After denying culpability for years, the bank agreed recently to a deferred prosecution agreement in the Madoff case. The agreement was described as a rare pact with prosecutors to head off a criminal case . . . suspending an indictment as long as the bank acknowledged the facts of the government’s case and changed its behavior.
“The bank signed off on statements of fact admitting to misrepresentations to investors and failing to inform regulators with their concerns in the Bernard L. Madoff Investment Securities LLC case,” Hairston added.
“I think that makes JPMorgan Chase ineligible to do business with the city because the city code states that any person or business entity who has made admissions of dishonesty or deceit . . . or failed to report suspicions of fraud is not compliant with the code,” she said.
Rahm ’em . . .
Former Defense Secretary Robert Gates’ blistering new memoir, “Duty: Memoirs of a Secretary at War,” may be critical of White House micromanagement and Congressional dysfunction, but Gates apparently got a kick out of Rahm Emanuel when he was White House chief of staff.
◆ Quoth Gates:
“I enjoyed Rahm. He made me laugh. He was a political animal to his core and often a source of considerable insight into politics and Congress . . . I would have some very serious differences with Emanuel over ‘Don’t Ask, Don’t Tell’ [the law concerning gays in the military], the budget, and Afghanistan but we got along personally.”
Goodbye to a hero . . .
Sneed is sorry to report that Stanley Pokrzywa, the proud World War II vet Sneed and assistant Mitch Dudek met and wrote about in 2010 and 2013, has died. Pokrzywa, who had been living in a Morton Grove nursing home, died at the age of 95 on Dec. 28. A widower and childless, Pokrzywa survived 195 days in combat in Europe during World War II; always wore a vest emblazoned with his prized U.S. Army 104th Infantry Division Timberwolf logo; and kept a Tupperware container full of war memories. On living to 100, Pokrzywa told Dudek in July: “Maybe I’ll make it. Maybe I won’t. But I have no regrets in life.”
Sneedlings . . .
Wednesday’s birthdays: Regina King, 43; Charo, 63, and Chad Lowe, 46.