JP Morgan Chase stockholder Michael C. Davidson is trying to get the Securities and Exchange Commission to approve his proposal to break the bank up. If the SEC allows it, the proposal will go to the bank’s shareholders. JPMorgan is one of the “too big to fail” banks US taxpayers had to bail out in 2008. The SEC adjudicates disputes between investors who want shareholders to vote on proposals during annual shareholder meetings, and companies who don’t want those proposals coming up.

Davidson’s proposal recommends splitting the company’s commercial bank operations from its investment banking and asset management units. He told the New York Times that huge raises given to management, including $13 billion the shareholders had to pay out in federal fines and huge bonuses to upper management including CEO Jamie Dimon, means the company is not looking out for its investors.

JPMorgan responds that the proposal falls in an area of business where shareholders have no standing. Even if the SEC agrees to let the proposal come to a vote and shareholders pass it, it wouldn’t be legally binding on the company, but it would force the board of directors to listen.

Note: an earlier version of this story put an “m” where a “b” should have been; JPMorgan paid $13 billion in fines, not $13 million.

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3 replies
  1. Gary Jarvis
    Gary Jarvis says:

    This article, concerning the proposal to break up JP Morgan Chase, hugely understated the amount paid by that bank in fines… The article stated that the fines paid were “13 Million”, when in fact, the fines levied were $13 BILLION!

    Gary Jarvis,
    Sweet Home

    Reply
    • Lynn Siprelle
      Lynn Siprelle says:

      Gary, thank you. I’ve corrected it. (In my defense it was more of a typo than a misstatement of fact, but I missed it in editing and…there you have it. I’m embarrassed.)

      Reply
      • Gary Jarvis
        Gary Jarvis says:

        Lynn, you are welcome… It just kind of jumped out at me. No need to be embarrassed, we all make similar typos… I used to write regular columns in my local union’s newsletter (as president), and was amazed at how often, even after proof-reading several times, I made similar typos!

        Reply

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