By Peter Schroeder - 11/04/13 12:12 PM EST
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.
The potential tax perk has also attracted attention on Capitol Hill. Five U.S. senators wrote to Attorney General Eric HolderEric H. HolderAirbnb celebrates voting rights bill while confronting discrimination allegations Holder: Trump 'a very shallow man' Mothers of the Movement: Hillary ‘isn’t afraid to say Black Lives Matter’ MORE Tuesday, urging him to explicitly prevent any tax writeoffs under the settlement. That letter was signed by Sens. Mazie HironoMazie HironoDem senator's name misspelled on convention screen Overnight Finance: Senate sends Puerto Rico bill to Obama | Treasury, lawmakers to meet on tax rules | Obama hits Trump on NAFTA | Fed approves most banks' capital plans Senate Dems pledge to keep fighting over Zika MORE (Hawaii), Bill NelsonBill NelsonNew study. Space, security, and Congress Puerto Rico task force asks for help in charting island's economic course Making the switch to a more competitive freight rail industry MORE (Fla.), Martin HeinrichMartin HeinrichDem senators back Navajo lawsuit against EPA Research: Infrastructure systems easy to hack, a little slow to patch Week ahead: Republicans dig into FCC agenda MORE (N.M.), Sheldon WhitehouseSheldon WhitehouseDem senator: Clinton may command 'majority of the Republican caucus' Banking association backs financial transparency bill Shift in care could reverse the opioid epidemic MORE (R.I.) and Elizabeth WarrenElizabeth WarrenProgressive groups urge Clinton to lead fight against a TPP vote Amazon hires antitrust lobbyist Jill Stein helps Trump as Ralph Nader helped Bush MORE (Mass.).
In the House, Reps. Peter WelchPeter WelchDems vow to keep heat on GOP over guns Can Congress tackle chronic illness in Medicare patients? Defiant Sanders tells supporters: 'You can beat the establishment' MORE (D-Vt.) and Luis GutierrezLuis GutierrezJuan Williams: Dems should not take Latinos for granted Israel’s false friends Hispanic lawmakers face painful decision on Puerto Rico 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.