BEIJING – According to The New York Times, JP Morgan did some Chinese business.
The Times is reporting that the storied investment bank is being investigated by the U.S. for allegedly hiring the children of prominent Chinese officials for bureaucratic and financial advantages, a process known as “doing business in China.”
The Security and Exchange Commission’s anti-bribery unit is looking into JP Morgan Chase’s reported cronyism, which includes the hiring of a banking regulator’s son in exchange for multiple important assignments from a state-controlled conglomerate. Calls placed to Chinese experts have not exactly been helping JP Morgan’s case.
“Oh yeah, JP Morgan’s been over here for forever. They are excellent at Chinese business,” said financial reporter Lo Xiaoning. “Close ties to government officials and prominent party members is crucial here. They took to that like a duck to water; it’s like they were from here.”
“JP Morgan? Heck yes, I do business with JP Morgan,” seconded market ombudsman Bao Qian. “They hired a railway official’s daughter and then promptly started advising his company on how to go public. Boom! Chinese business success.”
Accruing and collecting politically connected business associates in China is so commonplace that many firms struggle to get an edge without one. In the early and mid-2000’s, U.S. business giants engaged in Chinese “elephant hunting” in attempts to manage the multibillion dollar stock offerings of the biggest state-owned companies.
But according to the SEC, the Year of the Rat is over. While the commission concedes JP Morgan “seems well-suited to Chinese business,” it may be less in compliant “with American laws.” The SEC recommended spinning off a separate Beijing subsidiary or possibly “hiring some of our kids, too, like Bank of America.”
At press time, a contrite JP Morgan said it planned to leave China’s markets and “go do some Russian business instead.”