Elephant hunting MorganMove over London Whale, JP Morgan has a new Mammoth scandal on its hands:

America’s biggest bank, JPMorgan Chase has quit work on a Chinese firm’s initial public offering over a probe that it may be part of a larger ‘jobs for contracts’ hiring scheme called ‘elephant hunting’, made famous in the 2000s.

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Originally Posted at RT.com

The bank has cut ties with Tianhe Chemicals, a Jinzhou-based lubricant additive supplier, over its $1 billion IPO, both Reuters and the FT report on Tuesday, citing sources with direct knowledge of the matter.

At the center of the story is Joyce Wei, the daughter of Tianhe Chemicals Chairman Qi Wei, who worked at JPMorgan between January 2012 and August 2013, which multiple sources have confirmed.

This is the second Chinese IPO the bank has dropped over the ‘princeling probe’ – the hiring of relatives of wealthy and prominent Chinese businessmen in an effort to win company contracts. The Tianhe Chemicals IPO was slated for the second quarter of 2014.

“Elephant hunting”

The term “elephant hunting” was first used to describe the situation where Wall Street firms sought to receive mandates to manage multi-billion dollar offerings of stock by China’s state-owned giants.

$7.77 ShippingThe practice of hiring politically connected Chinese employees to win contracts dates back to the early 2000s, but the US Securities and Exchange Commission and Department of Justice recently looked into two specific cases involving JPMorgan’s China group.

US financial regulators instigated the probe in August 2013, after the bank hired the son of a former Chinese banking regulator, and then immediately won several contracts from the state-controlled China Everbright Group. JP Morgan reportedly had to step down as an underwriter of the Everbright Group’s $3 billion listing.

Another suspect was the daughter of a Chinese railway official who was accused of pocketing bribes in exchange for government contracts.

Rough start to 2014

In January 2014 , the bank agreed to pay $2.6 billion to the US government and to victims of Bernie Madoff’s $17.3 billion Ponzi scheme. The next big case against the bank in 2014 could be the manipulation of currency and precious metals.

Dozens of investigations against the bank, both by US and foreign regulatory authorizes, forced it to pay record-amounts of fines and settlements in 2013. The bank was slapped with a $13 billion fine in December for its role in America’s sub-prime mortgage crisis, and earlier handed over $6.2 billion over the Libor-rigging scandal.

On top of that, the bank settled cases over energy manipulation and probes by the New York Attorney General for selling bad securities worth up to $22.5 billion.

Since the beginning of the US financial crisis, the bank is estimated to have paid out $30 billion in legal fines. JP Morgan’s annual profits average $20 billion per year.

 

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  1. The glaring question becomes; how many scandals and fines have to occur before some of the top brass get prosecuted or at least fired?? It’s uncanny how JPM can just keep handing out dollars (a lot of the same money they got from tax payers) to make these problems go away. 

    • I’ve almost given up on believing that a place like JPM can blow up without someone behind the curtain actually allowing it to blow up i.e. a controlled demolition to start the next system. Don’t forget, that when you talk about taxpayer money, the federal reserve is buying mortgage backed securities at 100 cents on the dollar from the banks every month so in that regard and in others the banks are perpetually being reliquified. As well, much of the fines they pay end up being pennies on the dollar compared to the money they made from the crimes.
       
      The corrupt architecture of the western central banks and their bankster owners and the stranglehold they have over the government and regulatory bodies ( who just happen to control the armies and police ) is to use the term here, a rather large elephant to hunt.
       
      Every supposed sage, oracle and phenom has consistently said that this charade has lasted way longer than they though possible, but I do think that the fetid stench in the air may be the end game. I just don’t know how close we are.

    • @gogetter1132 and @CL
      You have to realize that JPM and their cronies ARE the insider operatives for the NWO Cabal here in the US.  So, they are all covered under the CIS  = “Corzine Immunity Service”  The Eric Holders of the world are the lapdogs for the criminals in charge.  Holder’s job is simply to be the NWO Bitch and maintain the optics of an appearance of a presence of justice.  He’s no more useful than the SEC or the CFTC.   Hence, the only prosecutions you will ever see are ‘corporate’ fines which, no matter how large they may seem to us outside the system, are simply regarded as a “Cost of Doing Business” associated with running the scams. — No one will go to jail under this system.  Remember, even the occasional investigations and prosecutions are only the Kardashian TV window dressing to keep the masses quiescent.

    • @Sovereign Economist
       
      Agreed.  In fact these “huge” fines levied upon these financial miscreants often amounts to only 1% or even less of their ill-gotten gains.  Some punishment!  I can see them now:  “Well, damn!  We only got away with stealing 99% of the money we thought we stole.  What the hell?”.   If this were REAL punishment, they would be liable for TRIPLE DAMAGES.  If they steal $100B, they would be on the hook for $300B.  Now THAT would be punishment.  But the chance of that ever happening is right up there with that of a killer asteroid impact… which is to say vanishingly small.

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