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It's easy to forget what the word "wrongdoing" means. In an era of daily multi-billion settlement deals, "wrongdoing" has become the lawyerly term to describe the assortment of misdeeds that corporations pay to expunge from their record.
In the last three years alone, JPMorgan Chase has paid to settle a long list of wrongdoings, including: rigging electricity prices in California and the Midwest; manipulating the market in the "London Whale" trading debacle; and bilking approximately 4,500 active-duty service members on mortgages.
Lost among the string of zeros and dollar signs associated with the legal term are the human consequences of these wrongdoings. When talking about the improper foreclosures JPMorgan was charged with, wrongdoing may mean that an elderly couple is forced to leave retirement and work again full time at whatever job will take them because a bank improperly foreclosed on the home they lived in for 26 years. Wrongdoing takes the face of a cancer patient who is now homeless after facing the choice between his medication and the colossal loan payments for his robo-signed mortgage.
These are the kinds of stories that dozens of people around the nation have sent to us along with the over 160,000 petitions we presented to the Justice Department this week urging the Justice Department not to allow JPMorgan to get a tax deduction for its expected settlement for mortgage lending misdeeds.
The upcoming JPMorgan Chase settlement is expected to be the largest corporate settlement in Justice Department history. Unless the Justice Department prevents it, JPMorgan could heap billions of dollars right back onto the shoulders of taxpayers by writing off its wrongdoing as a tax deduction. That would be adding insult to injury.
JPMorgan should not get taxpayer subsidies for ruining countless people's lives. Its actions were not just the ordinary and necessary cost of doing business.
160,000 people asked the Justice Department on Monday for real justice, not the tax deductible kind. Not justice that is diluted by tax write-offs that cheapen the deterrence against future misdeeds. The Justice Department should explicitly bar JPMorgan from deducting the cost of its upcoming settlement from its taxes. Prevent the deduction, and give homeowners the justice they deserve.
We know that the Justice Department has sometimes done this before, such as when it denied tax deductibility in last year's BP settlement.
The Justice Department only needs to spell that out. That's the common sense that so many people are demanding. Attorney General Eric Holder should heed their call.
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