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Running for President? Better Know a Big Bank Bundler (or Several Hundred)

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As Republicans gather in Tampa this week, they've got a bit of a problem: figuring out how to wine, dine, and celebrate their sugar daddies in style without ripping back the veil of secrecy they've drawn over their super-wealthy backers.

Pulling off such a stunt will be especially difficult right now. While the Romney Campaign still refuses to disclose its big money bundlers -- even though the Obama campaign has -- USA TODAY managed to ferret out a list. It turns out that fully 25 percent of these bag men come from the financial sector, which the American public rates as the second worst in the country, barely edging out the oil and gas industry.

To make matters worse, this summer was so packed with banking scandals that the independent investigative journalists at ProPublica put out a scorecard to keep track of the perpetrators (Barclays, JPMorgan Chase, Citigroup, UBS, Deutsche Bank and more), crimes, victims, and investigations. No wonder Romney wants to keep his relationships to these folks under wraps.

Unfortunately for Mitt, they seem to be outing themselves. Just last week one of them stepped onto the op-ed pages of The New York Times to sing the praises of the "too big to fail" banks: William B. Harrison Jr.

Until recently, the job of banker shill-in-chief would have gone to JPMorgan Chase CEO Jamie Dimon, but he'd just seen his reputation beached by the "London Whale" scandal. Instead, the honor fell to Harrison, the CEO who preceded Dimon at JPMorgan, and one of Mitt Romney's secret banker bundlers.

Maybe the Wall Street lobby figured that dusting off the former CEO would inoculate JPMorgan from association with current scandals. After all, it was Dimon, not Harrison, who was at the helm when JP Morgan joined the ranks of what the Times calls repeat violators -- those mega-banks that paid billions of dollars to settle fraud cases in the wake of the 2008 crisis, only to re-offend in short order. As the Times put it, "Nearly all of the biggest financial companies, Goldman Sachs, Morgan Stanley, JPMorgan Chase and Bank of America among them, have settled fraud cases by promising the S.E.C. that they would never again violate an antifraud law, only to do it again in another case a few years later."

JPMorgan's rap sheet includes, for example: purposeful or negligent fraud in interstate commerce (initial plus three repeat offenses) and purposeful fraud by securities firms (initial plus one repeat offense).

These offenses are documented by the Securities and Exchange Commission. Here's one example from the SEC's files:

  • J.P. Morgan Securities - The SEC charged the firm with misleading investors in a complex mortgage securities transaction just as the housing market was starting to plummet. JPMorgan agreed to pay $153.6 million in a settlement that enables harmed investors to receive all of their money back. (6/21/11)

Harrison, of course, was gone by then, so we can't pin this wave of crimes on him. But he was at the helm of the bank during the previous litany of major banking and accounting scandals.

Before becoming President and CEO of JPMorgan Chase after Chase Manhattan merged with JPMorgan, Harrison was Chase Manhattan's President and CEO after having served as Vice Chairman at Chemical Bank since 1990 (prior to its takeover of Chase in 1996). His stint covered the period in the late '90s and into the early 2000s that witnessed the Enron, Tyco, Worldcom and other scandals. Here's how one journalist characterized his bank:

Name a scandal-plagued US company in the headlines and one bank keeps showing up behind the scenes: JP Morgan Chase. Enron, Global Crossing, Tyco International and Kmart are among the troubled clients of America's second largest bank -- formed last year by the historic combination of two of the oldest names in the U.S. financial world, JP Morgan and Chase Manhattan.

Giant banks, giant scandals. And giant checks for Mitt Romney -- who has pledged not only to repeal the laws passed in the wake of the 2008 Wall Street scandals (Dodd-Frank), but also to repeal or weaken those put in place after the scandals in which Harrison was enmeshed (Sarbanes-Oxley). Bring out the champagne!