Banks Not Accountable? In the Past Two Years, JP Morgan Has Paid $7 BILLION in Fines: $5.29 Billion Over Robo-Signing Scandal, $300 Million - Misleading Investors About The Quality Of Mortgages Underlying MBS Securities... And More

Over the last several years, a new oath has appeared in the world of finance as global investment banks have been hauled in front of Senate committees, Congressional panels,  various regulatory bodies, and (what always used to be the harshest of judges) the public: the  Hypocritic Oath.

It begins thus: First, admit no wrong.

  In just the past two years, JPMorgan alone has paid some $7 billion in fines for a series of transgressions, including a whopping $5.29 billion fine over the robo-signing scandal, a further $300 million for misleading investors about the quality of mortgages underlying MBS securities – in perspective, the U.S. gives Israel USD$3bn a year in Foreign Aid… more than any other nation recieves.

$150 million over risky structured investments, $230 million over the alleged rigging of various bond auction processes, and $153 million for misleading investors in one of those oh-so-common allow-a-hedge-fund-to-select-a-portfolio-of-bonds-to-sell-to-investors-that-they-then-short scams.

     In most of these cases, the bank paid to settle the charges “without admitting or denying the allegations”.

Now, before anybody assumes this is another of those “bash JPMorgan” diatribes, it isn’t.

The Hypocritic Oath has been adopted by a multitude of banks in recent years and, like the Fifth Amendment, once it was rolled out, it seems to have been accepted absolutely without question (though the skeptics out there will naturally wonder why someone would pay a fine of several hundred million dollars when they had done nothing wrong — those pesky skeptics just can’t mind their own business, I guess).

Way back in November 2011, Citi agreed to a $285 million fine whilst neither admitting nor denying wrongdoing — something the judge in the case took issue with:

(CNN Money): But why would Citi agree to such a payment and reforms if they didn’t violate regulations? This conundrum is not a new one for Judge [Jed] Rakoff and one he raised in an SEC settlement case two years ago involving Bank of America. In that case,

although Bank of America had originally neither admitted nor denied the violations,

when the case came under scrutiny by Rakoff, Bank of America went ahead and denied.

MORE HYPOCRISY HERE