Who Does JPMorgan CEO Jamie Dimon Think He's Kidding?

Last Updated Apr 5, 2010 2:54 PM EDT

JPMorgan Chase (JPM) CEO Jamie Dimon recently said in his annual shareholder letter that the financial giant exists "to serve clients and earn their trust over a long period of time, and, in so doing, earn a fair profit." The company's executives have "always... been deeply committed to being good corporate citizens," added Dimon, who is the nation's most important banker and who effectively serves as the industry's unofficial spokesman.

But how to square these noble sentiments with federal allegations that JPMorgan conspired with other Wall Street firms to rig interest rates on securities sold to state and local governments? Writes Matt Taibbi in a story last week on what he characterizes as a scheme by big banks to rip off local communities in Alabama:

There was so much money to be made bilking these dizzy Southerners that banks like JPMorgan spent millions paying middlemen who bribed -- yes, that's right, bribed, criminally bribed -- the county commissioners and their buddies just to keep their business.
Also doing nothing to restore public trust is Dimon's contention that "banks are not fighting regulation." In what galaxy is the executive living where he thinks it's credible to make such a patently false claim? Because two years into the brawl over financial reform, it's beyond dispute that this is exactly what banks are doing on any number of issues.

Such fictions, spread by industry captains like Dimon, only reinforce people's low opinion and mistrust of banks. That's not something these institutions need right now. According to a new survey, the financial sector ranked last out of 14 industries in a measure of "corporate social responsibility," which takes things like a company's ethics and honesty into account.

Dimon's entire letter amounts to a carefully constructed alibi. He frames Wall Street's depredations in recent years as "mistakes," rather than as what they are -- standard operating procedure. In other words, Goldman Sachs (GS) didn't make a mistake in helping Greece cook its books; this is the sort of thing the investment bank does for a living.

It doesn't have to be this way. And not all financial execs, especially if you talk to them off the clock, are as disingenuous as Dimon. One bold (if anonymous) banker has even started a blog aimed at encouraging others in the industry to speak frankly about what's going on. Alluding to the government's bid-rigging charges, he asks:

The questions for discussion [are] these, what kind of culture and management practices encourage bad behavior? Are these isolated incidents or do such behaviors permeate institutions. How would we know?
Indeed. And if it's trust he cares about, Dimon would do well to ask himself the same thing.
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    Alain Sherter covers business and economic affairs for CBSNews.com.