JPMorgan Chase: Moral and Legal Obligations

Whereas, JPMorgan Chase engages in expensive, pervasive, repeated violations of law, crossing many regulatory and legal boundaries, recently exposing us to the largest civil penalty ever levied in the United States, and our Board of Directors has a longstanding failure to remedy known problems of internal controls and poor management;

Whereas, our Board’s Risk Policy Committee appears ignorant or unapprised of the regulatory, financial control, or operating risk environment of our business, and demonstrates a failure of understanding our key financial risks[1];

Whereas, shareholders are paying billions of dollars for the significant failures management exposes us to, including billions in fines from US government departments, nearly $240 million for abusive practices against our own customers, and millions for litigation costs–equaling almost 12% of our net revenue between 2009-2012[2];

Whereas, our company paid $56 million for abuses against US military personnel, including overcharging mortgages and wrongfully foreclosing on the homes of almost 6,000 soldiers, and paid another $45 million for charging hidden fees in Veteran’s refinancings;

Whereas, our company is continually in trouble with the SEC, has violated U.S Commodity laws, been fined by the British Financial Services Authority, and repeatedly wastes our money in continuing violations which may have contributed to the collapse of other major financial investment firms;

Whereas, the US Government has cited our company for egregious violations “because of reckless acts or omissions”[3] of Anti-Money Laundering laws and Bank Secrecy Act issues, including Weapons of Mass Destruction Proliferators Sanctions Regulations, Global Terrorism Sanctions Regulations, Iranian Transactions Regulations, Sudanese Sanctions Regulations, Former Liberian Regime of Charles Taylor Sanctions Regulations; therefore be it

Resolved

Shareholders request the board of directors prepare a policy review, at reasonable expense, evaluating opportunities for clarifying and enhancing implementation of Board members’ and officers’ fiduciary, moral and legal obligations to shareholders and other stakeholders, and to report on their findings, excluding proprietary or legally prejudicial information, no later than six months following the 2014 annual shareholder meeting.

Such a report may include concrete recommendations such as amending the bylaws, articles of incorporation, or committee charters to include specific language articulating or strengthening the company’s standards for directors’ and officers’ conduct and company oversight.

Supporting Statement

Fiduciary standards, codified in early law, secularized theological traditions applied to commercial pursuits and obligate directors to an ethical relationship with shareholders based upon trust and confidence.  Proponents of this resolution ask other shareholders to hold corporate leaders accountable to the highest possible standard of conduct.

In the opinion of the proponent, this review should at a minimum encompass the duties of:

• Loyalty, including clarifying the relationship between loyalty to the company and to society

• Care, including clarifying any duty of directors or officers to take action when having sufficient notice of potential impacts of corporate activities on society;

• Candor, including clarifying the extent to which directors and officers are required to provide balanced, truthful accounts of all matters disclosed in communications with stockholders and other stakeholders.

 


[1] GrahamFisher & Company, March 2013 http://www.scribd.com/doc/130291230/GF-Co-JPM-Out-of-Control

[2] Ibid

[3] http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20110825.aspx  Release of Civil Penalties Information – JPMorgan Chase Bank, N.A. Settlement 8/25/2011