JPMorgan & Chase Co (JPM) CEO Jamie Dimon has relinquished his role as chairman of the bank’s main subsidiary following a tumultuous year as its head.
Dimon first came to prominence as one of the few cool heads in the 2008 banking crisis, as JPMorgan avoided the catastrophic losses to which every other major financial institution fell prey. However, after several years as the posterboy of restraint and accountability, Dimon did a 180, and has become the go-to for stories concerning financial impropriety and unethical business practices.
While several scandals have rocked the bank, the most notable is probably the “London Whale” trade debacle, wherein the London branch of JPMorgan realized $6.2 billion in losses during the summer of 2012. While the losses themselves were obviously a problem, Dimon’s handling of the London Whale was what really took the sheen off of his previously impeccable leadership.
Dimon was criticized vehemently for withholding documents from investigators during ongoing investigations into the London Whale. But more infuriating to the public and investors than his lack of cooperation during the investigation was his flippant attitude.
Dimon infamously referred to the loss and resulting fervor and cover-up as a “tempest in a teapot” which, along with general sentiment the bank had put stockholder’s investments in jeopardy by failing to handle the situation correctly, spurred a coup against him and the JPMorgan itself, and led to an attempt to oust him from his leadership role and break up the bank.
That coup was crushed when a vote retained Dimon as CEO and chairman, although his pay had already been slashed in half as punishment.
Aside from the Whale scandal, which cost the bank $920 million in settlements just two weeks prior, JPMorgan has been embroiled in far reaching scandals ranging from bribing Chinese regulators to engaging in commodity price fixing.
JPMorgan’s attorneys claim Dimon is stepping down for technical reasons, and not because of any governmental pressure to minimize his position in the company.