[Congressional Record Volume 159, Number 170 (Tuesday, December 3, 2013)]
[House]
[Pages H7400-H7401]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                       JPMORGAN CHASE SETTLEMENT

  The SPEAKER pro tempore. The Chair recognizes the gentlewoman from 
Ohio (Ms. Kaptur) for 5 minutes.
  Ms. KAPTUR. Mr. Speaker, it has been reported that JPMorgan Chase has 
agreed to a $13 billion settlement of the civil suit filed by the 
United States Department of Justice and the Federal Housing Finance 
Agency in order to resolve several investigations into their mortgage 
securities finagling. JPMorgan and it affiliates knowingly 
misrepresented the value and quality of the mortgage bonds that it sold 
to the housing finance agency. Compared to the trillions that Wall 
Street banks have extracted in home equity from the American people, a 
$13 billion settlement with JPMorgan Chase doesn't come close to 
repaying the American people what they are owed back. More cases need 
to be filed to mete out justice and recoup what has been wrongly taken.
  Of the $13 billion settlement, $4 billion will be for the Federal 
Housing Finance Agency which will go to Fannie Mae and Freddie Mac. How 
that filters down to the street, to the ordinary homeowner, we can't 
predict. Two billion will be credited through JPMorgan's reduction of 
principal on mortgages in areas hardest hit by foreclosures like 
Detroit and cities like Cleveland and Toledo in Ohio.
  JPMorgan Chase currently holds--get this--nearly 1 million mortgages: 
208,000 mortgages considered seriously delinquent and an excess of 
700,000 which are underwater. That's too much power over our 
marketplace in too few hands.
  Five hundred million of the settlement will be credited for the 
removal of blight from neighborhoods through demolition, reducing 
interest rates, and offering new loans to low-income borrowers. My 
goodness, every community in America could use some of that. That's 
very little money for a very big hole.
  This settlement may appear like a big step. It's a small step in the 
right direction. However, let me put these figures on the record. Last 
year, JPMorgan Chase made $21.3 billion in profits--and that doesn't 
count what's in their reserves. A settlement of $13 billion therefore 
is barely half of what JPMorgan made in all of last year after 
expenses. In fact, this settlement of $13 billion is equal to exactly 
half of what they had already set aside, $26 billion, for legal fees 
since 2010. By the way, they make their money by charging all of us 
high fees, or paying us nothing on our savings accounts and 
certificates of deposit.
  Moreover, the settlement will also be largely tax deductible for the 
bank, as well. Although the tax law does not allow fines or penalties 
paid to the Federal Government to be tax deductible, that only accounts 
for $2 billion of the settlement that the bank has to pay in civil 
penalties to settle their legal claims. That leaves $7 billion in 
compensatory damages that the bank could claim, for guess what? In tax 
deductibles. Imagine that. This greatly reduces the impact this 
settlement has on correcting their bad behavior and mitigating the 
damages it has to pay in the lawsuit. Imagine if homeowners were 
allowed to deduct the damages they have incurred as a result of Wall 
Street's misbehavior. Now, there's an idea.
  Here are some figures to ponder: Over the last couple years, the CEO 
of JPMorgan has taken home anywhere from $23 million plus bonuses, plus 
stock options, on an annual basis. Mary Erdoes, the CEO of their asset 
management division, last year it was reported was paid $15 million 
plus $5 million in bonuses--bonuses. This is before they have settled 
all of these mortgages that they hold belonging to the American people.
  Matthew Zames, their co-chief CEO, $17 million plus $6 million in 
bonuses, and Daniel Pinto $17 million in salary alone plus $8 million 
in bonuses, not counting all their stock options, cars, you know, all 
those things that they're given in their privileged positions.
  The American people are really sick of this. They really want 
justice. We need more legal cases filed, and Congress should reinstate 
the Glass-Steagall Act by passing H.R. 129, the Return to Prudent 
Banking Act of 2013. This will end what caused the financial crisis--
too much power in too few hands, and the power to create money 
irresponsibly. Our country should never again have to endure this kind 
of collapse because of the mistakes that they made.
  Mr. Speaker, I think it's time for community after community to 
replicate those legal cases that have been successful in extracting 
repayment to communities and to harmed families across our country.

[[Page H7401]]

                              {time}  1030

  Our U.S. Attorney, our housing organizations across this country, 
those Attorneys General who are awake in our 50 States, we need to go 
after the source, the source that created the collapse that our 
communities are still suffering from. They must be held accountable for 
the mortgages they still hold, and recoup for millions and millions of 
our people the home equity that was taken from them so cruelly.

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