JPMorgan Chase (JPM) CEO Jamie Dimon is filling headlines amid the lender's recent third-quarter earnings results. Despite the media’s cries for the CEO's ouster, there is a huge disconnect when it comes to the people who matter—investors, analysts, board members and regulators. Per the New York Times:
In the defense of Dimon:
Daniel Loeb, the activist investor who has made a career out of targeting troubled companies and ousting their chief executives, also sided with Mr. Dimon. “In my experience, they are meticulously ethical, and nobody has a more rigorous compliance effort.” He added, “It’s a very large and complex company, and things will happen.” But he said that Mr. Dimon was now “being used as a scapegoat and piñata to satisfy some kind of bloodlust.”
So what are people accusing him of?
JPMorgan’s legal troubles stem from a series of problems: the multibillion-dollar trading loss from what’s become known as the London Whale, the sale of flawed mortgage-backed securities without fully warning investors of the risks, accusations it manipulated energy markets in California and Michigan and a continuing inquiry into the bank’s hiring of the sons and daughters of political leaders in China.
However, the article noted that Dimon might not be the one to blame.
The largest problem from the perspective of fines is the mortgage-backed securities, which could cost the bank $11 billion or more. But many problems stemmed not from bad behavior at JPMorgan but at Bear Stearns and Washington Mutual, two firms that the government encouraged JPMorgan to acquire in 2008 to help avert a market panic.