Left pushes to trim JPMorgan tax breaks on settlement

Liberal advocacy groups are mounting pressure on the Justice Department to bar JPMorgan from deducting from the bank’s taxes any portion of a broad government settlement in the works.

The reportedly $13 billion settlement over the bank’s mortgage activities before the financial crisis, which is still being hammered out, would be the largest such settlement in U.S. history. But reports that JPMorgan is seeking use up to $4 billion of the settlement as a tax write-off has led to protests from liberal groups and lawmakers.

On Monday, two groups delivered over 160,000 petitions to the Justice Department calling for barring any potential tax benefit. The groups, U.S. PIRG and Americans for Tax Fairness, argue it is patently unfair for taxpayers to help subsidize JPMorgan’s fines through the tax code.

ADVERTISEMENT
“The American people were already victimized once by Wall Street’s malfeasance. They should not be victimized again by having to pick up more of the tab,” said Frank Clemente, campaign manager for Americans for Tax Fairness. “The Obama administration should be helping homeowners with underwater mortgages, not be giving tax breaks to the banks that put them there.”

 The potential tax perk has also attracted attention on Capitol Hill. Five U.S. senators wrote to Attorney General Eric HolderEric H. HolderOvernight Tech: Uber CEO resigns | Trump's Iowa tech trip | Dems push Sessions to block AT&T-Time Warner deal | Lawmakers warned on threat to election systems | Uber CEO Travis Kalanick resigns Holder mulling 2020 bid MORE Tuesday, urging him to explicitly prevent any tax writeoffs under the settlement. That letter was signed by Sens. Mazie HironoMazie HironoSenate Dem offers patent reform bill Office of Government Ethics: Bannon’s waiver 'problematic' Twitter mocks GOP for using movie gif to dismiss Comey statement MORE (Hawaii), Bill NelsonBill NelsonDriverless cars speed onto political agenda Biden leaves options on table for another White House bid Senate votes to continue arming Saudis As Yemenis suffer the consequences MORE (Fla.), Martin HeinrichMartin HeinrichThe Memo: Five takeaways from Jeff Sessions’s testimony Overnight Cybersecurity: Sessions denies Russia collusion | First agency gets 'A' grade on IT | Feds out North Korean botnet | Unusual security update for Windows XP Live coverage: Sessions testifies before Senate Intelligence Committee MORE (N.M.), Sheldon WhitehouseSheldon WhitehouseJudiciary Committee to continue Russia probe after Mueller meeting GOP hits the gas on ObamaCare repeal Dems limited in their ability to slow ObamaCare vote MORE (R.I.) and Elizabeth WarrenElizabeth WarrenLive coverage: Senate GOP unveils its ObamaCare repeal bill Overnight Regulation: Labor groups fear rollback of Obama worker protection rule | Trump regs czar advances in Senate | New FCC enforcement chief Budowsky: Dems madder than hell MORE (Mass.).

In the House, Reps. Peter WelchPeter WelchHouse Dems slam Trump's 'betrayal' on drug pricing Washingtonians take center stage at Will on the Hill Bring real consumer choice back to Medicare Part D MORE (D-Vt.) and Luis GutierrezLuis GutierrezJudiciary Dem asks GOP chairman to invite Trump to testify in public The Hill's 12:30 Report Dems plan to sue Trump over conflicts of interest: report MORE (D-Ill.) introducing legislation barring companies from using the tax code to deduct costs from government settlements, and Welch also sent a letter to the bank’s chief executive, Jamie Dimon, urging him to avoid the writeoff.

While the bulk of the settlement is still being finalized, the Federal Housing Finance Agency announced in October it had struck a $4 billion settlement with the bank, after it charged JPMorgan broke securities laws when it sold securities loaded with risky mortgages to Fannie Mae and Freddie Mac.