Politics

Elizabeth Warren Fires Back At Bank CEO, Says Bankers Don't Like Her Because She Knows Their System

| by Alexander Rubinstein

Sen. Elizabeth Warren had some choice words for JPMorgan Chase CEO Jamie Dimon following his claim she does not understand global banking.

“I don’t know if she fully understands the global banking system,” Dimon was quoted as saying at a recent Chicago event.

Dimon’s comments have been criticized as dismissive. Yahoo Finance’s Laren Lyster said, “When someone is critical of finance or the banking system (the default response is) 'oh they don’t understand finance, it’s too complicated.’”

Warren is on the Senate Banking Committee and she is generally considered a wonk when it comes to banking. Warren taught corporate law at Harvard University for nearly 20 years. She has published nine books. She chaired the Congressional Oversight Panel that oversaw the 2008 bank bailouts, of which JPMorgan Chase was a beneficiary.

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Warren also came up with the idea for the Consumer Financial Protection Bureau which helps consumers avoid predatory lending schemes. The bureau has since recouped $4.8 billion through enforcing its policies, Think Progress reports.

Warren has in the past taken issue with the Justice Department for failing to prosecute banks when they break the law. She said, “If large financial institutions can break the law and accumulate millions in profits and, if they get caught, settle by paying out of those profits, they do not have much incentive to follow the law.” She also proposed a bill to make settlements between banks and financial regulators more transparent.

In 2013, JPMorgan Chase announced one of its traders in London made some bad bets that cost the bank $6 billion. The bank had to pay $900 million in fines and “Admit its traders acted recklessly” for violating market manipulation rules. Warren said the incident made the case for returning to “boring banking.”

“The problem is not that I don’t fully understand the global banking system,” Warren said during an interview with The Huffington Post’s “So That Happened” in regards to Dimon’s remarks.

“The problem for these guys is that I fully understand the system, and I understand how they make their money. And that’s what they don’t like about me.”

She recently argued that federal regulators could do better to keep up with new banking practices.

“When you do regulations that wait until, you know, the bank invents something else in order to trick people or to take on more risk and shift it over to the taxpayers, and regulators are always two steps behind trying to figure it out, that one is a tough approach,” Warren cautioned, according to The Hill.

Warren is no newcomer to criticisms from some of the world’s wealthiest. Warren Buffet, CEO of Berkshire Hathaway, said she is too “angry” and “violent” in her critiques of Wall Street.

Banks have previously threatened to withhold campaign donations to every Senate Democrat in protest of the Massachusetts senator. JPMorgan Chase told Democrats that donations are dependent on a friendlier atmosphere.

Sources: Yahoo Finance, Think Progress, The Hill

Photo Source: AFGE, Flickr Creative Commons