How much would a high profile bank robber have to donate to your favorite local non-profit in order for you to feel okay with that non-profit accepting that criminal's dirty money?
$10,000? $100,000? $1,000,000? What about zero dollars, but a chance to get a piece of their loot?
On Wednesday, September 19, voting ends for the Chase Giving program. The next day, JP Morgan Chase program will give away a total of $5 million dollars to 196 different charities from across the USA this year.
Nearly 5,000 registered 501(c)3 organizations from across the nation are in the running, including a few of my favorite local non-profits. A few of these organizations have been urging me to enroll in Chase's data mining Facebook application (don't worry, Chase assures me, they "will not share your information with other parties for their advertising purposes") in order to vote for them in this year's "Chase Giving" contest.
I plan to do no such thing.
I am not calling JP Morgan Chase a criminal institution, but for a firm that isn't committing any crimes, they sure are spending a lot of money on legal defense lately -- like $3.2 billion in 2011, down from $5.7 billion in 2010.
I run through a recent history of Chase's capers below, but if you read no further, suffice to say that the public record reads like a kingpin's rap sheet and explains a lot about why Chase is spending so much on legal fees.
The public record also probably explains why Chase execs must be high-fiving their PR people for their effectiveness in enlisting precisely the organizations that Americans trust the most to help polish Chase's corporate image. For a company stands to gross more than one trillion ($1,000,000,000,000) dollars this year, has an ad budget in the billions of dollars, and stands to spend tens of millions of dollars influencing our political system in 2012, the budget for Chase Giving is pretty much a rounding error.
And what is Chase getting for the crumbs they're throwing in the direction of our favorite non-profits? Well, they are essentially buying brand value from the one sector that still has much credibility at all with the general public. They have created a dynamic by which small and mid-sized organizations are proactively sending out tweets, Facebook messages and emails to their supporters branded by Chase. Smart. And of course, they will doubtless use the Facebook data they harvest from this program to refine their marketing in the future. Genius.
And in addition to the implicit endorsement Chase is buying from local non-profits, Chase is buying their silence. Chase reserves the right to disqualify any organization, at any time, for pretty much any reason. So we won't be hearing biting critiques about predatory banks from any of the leaders of these non-profit organizations any time soon.
"Self-censorship is a bummer," you're saying right now, "but we're talking about big bucks for small organizations!" Well, yes and no. In fact, the odds of any given eligible organization winning are about the same that any of us will be killed a car crash. This isn't a random contest though, so perhaps a better way of thinking about it is the cost/benefit calculation facing the leaders of local non-profits around expending resources to chase Chase's money.
· Staff time that would otherwise be devoted to cultivating long term funding relationships with donors or pursuing the programmatic mission of the organization.
· Reputation will probably not be harmed among many your friends and supporters, unless they're crotchety like me, but I have talked to a few friends who feel the same nausea that I do about the corrupting potential of this contest.
· Stakeholder fatigue could result from your org bombarding your supporters with reminders to vote. Some of those people will unsubscribe/de-friend you.
· Relationship building with your base from increased interaction. This could happen, but I think stakeholder fatigue is more likely.
· Development of social media skills is a likely benefit for many non-profits, though if your organization is just now figuring out what a hash tag means, you probably won't be winning this contest any time soon.
· $$$ - well, yeah, if your organization gets even the smallest grant of $10k, you're stoked, but that money is a one-time windfall rather than recurring revenue so there will be a big budget gap next year unless that money is prudently deployed or lightning strikes again in 2013.
Chase's Rap Sheet:
Why is Chase so eager to get all of us who care about our local non-profits to start talking about Chase's good works? May I suggest because they'd prefer we didn't talk about what an extreme menace to society it is...
I'm not saying that JP Morgan Chase is a felon, but it was one of four major banks that signed onto a $25 billion consent judgment to avoid prosecution from a long list of federal and state authorities. Chase and its peers were accused of things like systematic "mortgage loan servicing and foreclosure abuses" and "fraudulent and wrongful conduct." Millions of Americans have been thrown out of their homes and into poverty as a result of an economic disaster that Chase helped create. I cringe when I think that organizations working to fight poverty having to pander to and publicize for Chase.
I'm no lawyer, but David Sheehan is the attorney who represented the trustee trying to recover funds from Bernie Madoff's pyramid scheme. He said that JPMorgan "was at the very center of that fraud, and thoroughly complicit in it." Sheehan is looking to recover $19 billion from Chase because he alleges that JPMorgan Chase "not only should have known that a fraud was being perpetrated, they did know."
Chase wasn't technically convicted of violating the Service Members Civil Relief Act, but did acknowledge violating it. Chase overcharged and illegally foreclosed upon deployed U.S. military service people. Chase paid $56 million to resolve that little mistake. With no apparent irony intended, "military and veterans" is one of the 5 categories of non-profits in the Chase Giving scheme. Vote early and often folks!
If you read JPMorgan Chase's CSR report, you might find yourself amazed at what an upstanding corporate citizen Chase is, but then again Chase's lawyers did agree to a $722 million settlement with the U.S. Securities and Exchange Commission to end a probe into sales of derivatives that helped push Alabama's most populous county to the brink of bankruptcy. The SEC alleged that J.P. Morgan Chase bribed key authorities to get the deal and, with the authorities in their pockets, stuck it to the citizens of Jefferson County.
So if you really want to help address some of the issues facing your community, instead of consigning your data and dignity over to Chase, go out and join or restart your local Occupation. If you are too busy or timid to do that, consider finally moving your money out of the big bank that is currently using your own funds to exploit you. These links will help you find local credit unions or community bank. Whatever you do, remember that while Chase gives some money back, its business mostly involves taking money out of our local communities.
Follow Jack Ucciferri on Twitter: www.twitter.com/rawvolition