Corporate crime has become increasingly common over the past couple of decades. It seems that every big corporation today has some type of dark side. With the constant trials against corporate officials it seems that many high profile companies can no longer be trusted. We can no longer look at our banks the same either; JPMorgan Chase in the recent two years can be added to corporate crime list. They have committed crimes against its costumers and the government by rigging their bids for investments for years, improper home insurance rates, and overcharging military veterns. From this they stole millions of dollars to put in their pockets. What makes this case interesting is that Chase is one of the top banks in this country. Millions of Americans trust this bank with their life savings it turns out they trusted their money with criminals.
The first crime allegedly took place during the years of 1997 to 2005 and was first covered in July of 2011. The bank, “cheated governments in 31 states by rigging the bidding process for reinvesting the proceeds of dozens of municipal bond transactions (2).” They didn’t do this on their own thought; they had help from about 11 bidding agents. As some background to what the bidding process is, it is when cities with the help from the banks bid for re investment products. The cities take their tax money and buy the bonds from the banks for this investment. What Chase did was they; “won investment business because it got information from bidding agents about what its competitors were bidding. In other cases it deliberately submitted non winning bids to satisfy tax requirements.” (2) The also admitted to entering, “secret agreements with bidding agents (2).”
The motivation behind this was the economy was going down and everyone was loosing money. Chase needed to remain on top and keep brining in the profit so they created a scam that wound up hurting many investors including, “General Motors pension plans and a Lutheran nonprofit life insurer (3).” This scandal up until the time it broke was one of the biggest cases to have happened. It was also similar to the Golden Sachs allegations. Evidence found against them was e-mails from different representatives saying; “We all know [Magnetar] wants to print as many deals as possible before everything completely falls apart (3).”
There was no heavy amount of punishment given to Chase executives. They had to pay of about 211 million insuring the investors will get their money back. However, this payment didn’t significantly impact the company since back in 2007 they lost $900 million in a deal gone wrong. The only person to really get the blame was Edward S. Steffelin the companies’ advisor, “was charged with civil securities fraud in the case (3).” For the rest of JP Morgan Chase they claim to have no knowledge of this and they do not, tolerate anticompetitive activity (3).”
Earlier this January, JP Morgan was suspected of committing home insurance fraud...