The unthinkable is happening with alarming regularity at the Frankenbank JPMorgan Chase. Over the last seven years, with Chairman and CEO Jamie Dimon at the helm, JPMorgan Chase has managed to do what no other federally-insured American bank has managed to do in the history of banking in the United States. The bank has admitted to five separate felony counts brought by the U.S. Department of Justice, while regulators took no action to remove the Board of Directors or Jamie Dimon.
Now, once again, the outrageous hubris of this Board is on display. Just last fall the bank forked over $920 million of shareholders money to settle its fourth and fifth felony counts brought by the Department of Justice, this time for rigging the precious metals and U.S. Treasury market. Now, in the dog days of summer, rarely a time for bonuses on Wall Street, the JPMorgan Chase board announced on July 20 that it is giving Dimon 1.5 million stock options which, according to a specialist cited at Bloomberg News, have a total value of $50 million on paper.
In its filing with the SEC, the Board wrote this about the 1.5 million stock option award to Dimon:
“This special award reflects the Board’s desire for Mr. Dimon to continue to lead the Firm for a further significant number of years. In making the special award, the Board considered the importance of Mr. Dimon’s continuing, long-term stewardship of the Firm, leadership continuity, and management succession planning amidst a highly competitive landscape for executive leadership talent.”
Translation: No one else wants to run a mega bank with a rap sheet like ours.
Here’s the sneaky way that the Board gave Dimon a $50 million bonus. According to the SEC filing, the exercise price of the options is “equal to the average of the high and low prices of JPMorgan Chase & Co. common stock on July 20, 2021” – the date of the award. As luck would have it for Dimon, the stock traded in a wide range that day, with a low of $146.33 and a high of $151.12, providing an average exercise price of $148.73 – a very low exercise price for a stock that has traded in the $160s this year. Dimon would get the difference between what he pays to exercise the option (the exercise price) and what it’s trading at when he decides to sell the stock.
