Source: Fortune
Summary
JPMorgan CEO Jamie Dimon dismissed President Donald Trump’s $5 billion lawsuit against the bank, stating that the case has no merit. Trump had accused JPMorgan of cutting business ties with him for political reasons after the 2021 US Capitol storming. Dimon acknowledged that the bank had shut over 50 accounts linked to Trump, but maintained that it does not close accounts for political or religious reasons. Trump has filed multiple lawsuits since his return to office, including against Capital One and the Internal Revenue Service. Dimon expressed understanding for Trump’s anger, but emphasized that banks operate under a regulatory framework that penalizes lenders for “reputational risk”.
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The numbers tell one story.
JPMorgan closed over 50 accounts linked to Trump in 2021, including those tied to hotels, housing developments, and Trump’s personal private banking relationship. Dimon acknowledged that the bank does not make much money from these accounts, making it easier to close them to avoid risk. The Trump administration has pushed to remove reputational risk as a consideration from federal bank examinations. Dimon expressed hope that the law will change and the issue will be sorted out.
Reputational risk is a convenient excuse for banks to cut ties with controversial clients.
Author: Evan Null
