The Senate Banking Committee is responding to outrage over the news that J.P. Morgan lost some $3 billion in customer money because of a risky trading strategy. The committee is preparing for two hearings with regulators, and Senator Tim Johnson (D-SD), chair of the committee, is hoping that Jamie Dimon will testify in the near future. “Our due diligence has made it clear that the Banking Committee should hear directly from JPMorgan Chase’s CEO Jamie Dimon,” Johnson said in a statement last week.
Luckily for Dimon, the professional staff in charge of managing the banking committee will be quite familiar to him and his team of lobbyists. That’s because the staff director for the Senate Banking Committee is none other than a former J.P. Morgan lobbyist, Dwight Fettig.
In 2009, Fettig was a registered lobbyist for J.P. Morgan. His disclosures show that he was hired to work on “financial services regulatory reform” and the “Restoring American Financial Stability Act of 2009″ on behalf of the investment bank. Now, as staff director for the Senate Banking Committee, he will be overseeing the hearings on J.P. Morgan’s risky proprietary trading.
On the House side of Congress, J.P. Morgan may see even less of a risk in upcoming hearings. Chairman Rep. Spencer Bachus (R-AL), who would presumably manage any investigation into the bank, has already offered comments to the press defending the investment bank’s trading decisions.
K Street lobbyists occupy some of the most important positions in Congress. Tim Johnson isn’t alone in relying on a former lobbyist. At least fifteen freshman Republicans in Congress hired K Street lobbyists as their chiefs of staff in 2010. Two senators, Marco Rubio (R-FL) and Ron Johnson (R-WI), hired lobbyists from the same firm, Navigators Global, to head their office.
According to disclosures filed with the ethics committee, Fettig made $448,225 a year as a lobbyist before moving back through the revolving door. Before he was a lobbyist for Freddie Mac, J.P. Morgan, and other financial industry interests, Fettig served as a Legislative Director for Senator Johnson. Though he is making less money now as a civil servant, his privileged position at the helm of Wall Street policy in the Senate will make him even more valuable to K Street if he chooses to leave.
Although the $3 billion dollar trading loss has damaged J.P. Morgan’s prestige in Congress, the investment bank maintains strong ties to the Beltway. As Republic Report noted last week, Senator Mark Warner (D-VA), one of the bank’s defenders on Capitol Hill, is personally invested in the J.P. Morgan-owned hedge fund that may be impacted by Dodd-Frank reforms on proprietary trading. The investment bank also has an army of lobbyists retained through multiple firms, and Jamie Dimon has helped lead groups like the Business Roundtable in weakening the Volcker Rule — the regulation that many say would have prevented the trading unit loss now at the center of attention.
Republic Report is an investigative news blog dedicated uncovering the corrupting influence of money in politics.
The stakes have never been higher (and our need for your support has never been greater).
For over two decades, Truthout’s journalists have worked tirelessly to give our readers the news they need to understand and take action in an increasingly complex world. At a time when we should be reaching even more people, big tech has suppressed independent news in their algorithms and drastically reduced our traffic. Less traffic this year has meant a sharp decline in donations.
The fact that you’re reading this message gives us hope for Truthout’s future and the future of democracy. As we cover the news of today and look to the near and distant future we need your help to keep our journalists writing.
Please do what you can today to help us keep working for the coming months and beyond.