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.
- Investigation Implicates Pacific Air Research in Pesticide Spray - April 9, 2014
- Oregon Zoo Tiger Dies - March 25, 2014
- NSA Collecting All Phone Calls from One Country - March 20, 2014