Epstein/Staley: JPMorgan should heed the judgment of Solomon
“As an organisation that seeks to stay as much as a standard set of beliefs and values, we’re answerable for one another’s actions,” wrote Goldman Sachs chief govt David Solomon in 2020.
On the time, Goldman was settling multibillion-dollar liabilities over its function within the 1MDB corruption scandal in Malaysia. “When a colleague knowingly violates a agency coverage, or a lot worse, the regulation, we — as a agency — have to simply accept accountability and recognise the broader failure that particular person behaviour represents,” Solomon added.
Such a reckoning could also be approaching JPMorgan. The financial institution is going through a number of lawsuits accusing it of facilitating intercourse trafficking by the late Jeffrey Epstein, who was a shopper of JPMorgan’s non-public financial institution by means of 2013. The main target has turned on Jes Staley, a longtime JPMorgan govt who later served as chief govt of Barclays.
Staley was personally near Epstein, based on messages and paperwork. He has even been accused by one alleged Epstein sufferer of personally taking part in wrongdoing.
JPMorgan on Wednesday took the extraordinary step of suing Staley with the purpose of creating him personally liable if there’s a judgment towards the financial institution stemming from the allegations about its Epstein relationship. “If the allegations of [plaintiff Jane] Doe and the US Virgin Islands are true, Staley repeatedly deserted the pursuits of JPMorgan and served his personal and Epstein’s pursuits,” the financial institution wrote in courtroom papers.
The incentives of employers and workers are usually aligned. Within the occasion of a financial institution, excessive shopper charges generate earnings for the corporate and excessive pay for particular person bankers. However how vigilant ought to a lender be in monitoring how a star performer generates these charges? The temptation could also be to let scrutiny slip.
Professing shock and blaming a “unhealthy apple” in a while is questionable when an employer and its stakeholders might have benefited from a person’s alleged misconduct. JPMorgan’s try and shift some culpability to Staley ought to matter little to the plaintiffs, whose main goal for now’s the financial institution.
JPMorgan and Staley deny they’ve any legal responsibility for Epstein’s crimes. Whereas these lawsuits are adjudicated, the financial institution could be well-advised to review Goldman’s ethos regarding collective accountability.
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