JPMorgan Chase Essay Example for Free

JPMorgan track EssayJPMorgan observe is one of the oldest and most respected money boxs in the United States. However, during the summer of 2012 Chase announced trading losses and bad rangement decisions that resulted in a loss of approximately $5.8 billion. Not only did they report this substantial loss they admitted to falsifying their staple drag reports, were they where attempting to conceal the massive loss. Three months prior to this event JPMorgan Chase was viewed as the top American bank. The first question to be discussed in this paper forgeting be what actions can administrative Agencies such the Securities and permutation heraldic bearing (SEC) and or the Commodities Futures Trading Commission (CFTC) take to prevent high risk gambles in securities/banking which ar one of the briny cornerstones of this countrys economy. According to the SEC, their main mission is to protect investors, to maintain fair, orderly, in force(p) markets and facilitate capital form ation (www.sec.gov) One of the ways that SEC does this is by requiring public companies to disclose meaty financial instruction to the public to help the public decide which companies will be the best to invest in. In response to the JPMorgan Chase revelation SEC Chair soulfulness Mary Shapiro told the Senate Banking Committee that her agencys investigation is limited, because the trades happened in divisions of the banking giant that argon not subject to SEC regulation. She also tell that we (the SEC) did not have any direct oversight or knowledge of the transactions. In humanitarian to the above statements Ms. Shapiro stated that the SECs investigation would target the appropriateness and completeness of the entitys (JPMorgan Chase) financial describe and separate public disclosures (Liberto, 2012). future(a) I will discuss the Commodity and Futures Trading Commissions (CFTC) main purpose as well as some of its other responsibilities.The Commodity and Futures Trading Commis sions (CFTC)main purpose is to regulate commodity futures and options markets. Its goals include the promotion of competitive and efficient futures markets and the testimonial of investors against manipulation, abusive trade practices and fraud (www.sec.gov). Gary Gensler, chairman of the CFTC told the Senate Banking Committee that he couldnt provide specific information about the investigation, but he did say that he first learned about the questionable trades from argue reports. He also stated that the CFTC does not have regulators on the ground to look at bank trades yet. Chairman Gensler also told the Banking Committee that currently, the American public is not protected in that way (e.g. having regulators looking for at the trades as they happen) (Liberto, 2012). Regulators have been struggling for months trying to figure out who should be included in a new crackdown on swaps and derivatives.Swaps and derivatives ar complex financial bets derived from other financial produc ts. Gensler made it lightsome that once the Dodd-Frank W tout ensemble Street reforms be fully implemented it will be illegal for JPMorgan Chase to make the kinds of trades that resulted in the $5.8 billion loss. He also clarified that Dodd-Frank allows for trades made to hedge against individual and entirety positions not to guard against future economic losses, as the JPMorgan trades have been described (Liberto, 2012). Next I will cover the elements of a logical contract, as well as discuss how consumers and banks each have a duty of god faith and fair dealing in the banking relationship A contract is a licitly enforceable see to it or set of promises. If the promise is broken, the person to whom the promise was mad the promise has certain legal rights against the person who made the promise the promisor (Bagley, 2012). There are 4 basic elements to a contract and they are 1) offer and acceptance, 2) consideration, 3) both parties must have the capacity to enter into a c ontract, 4) the contract must have a legal purpose.The offer is a manifestation of willingness to enter into a stipulation that justifies some other person in understanding that his or her assent will conclude the bargain (Bagley, 2012). Acceptance indicates the receiving persons willingness to enter into the agreement proposed in the offer (Bagley, 2012). Consideration is something of value that is provided by both parties (Bagley, 2012). Lastly, a valid contract requires that both parties have the capacity to enter into the agreement (Bagley, 2012. Next I will discuss the duty of god faith and fair dealingin the consumer/banking relationship. antecedent to 1929, Massachusetts expressly provided that good faith was applicable to all contracts. In 1929, the Supreme Judicial Court, in addressing a go against of contract claim under an option agreement for the purchase of stock in an oil-producing leasehold, expressly stated, for the first time, that there was an obligation of goo d faith and fair dealing in all contracts.The court emphasized that a railway line contract is to be interpreted as a business transaction entered into by practical men to accomplish an honest and straightforward end. Beginning in 1936, the duty of good faith was defined as a covenant that neither party shall do anything which will have the effect of destroying or injuring the right of the other party to receive the fruits of the contract. This fruits representative of the duty of good faith remains intact today and is regularly quoted as the operative modular (Weigand, 2013). The next topic is to compare and contrast the differences between knowledgeable and negligent tort actions. There are several types of intentional torts and they are torts against persons, intentional torts that involve personal space, and intentional torts with regard to economic hobby and business relationships.There are also several types of negligent torts. Two of which are duty to render and duty t o invitees. Intentional torts against consist of battery, assault, false imprisonment, intentional infliction of emotional distress, defamation, and invasion of privacy. The key news show in all of these intentional torts is intent or purpose to cause harm to another. Intentional torts against property include trespass of land, nuisance, conversion, and trespass to personal property. Intent and purpose are also why these are considered intentional. The key difference between these two torts is that one is against people and the other is a misuse of anothers property. An individual has to purpose practise these acts. Negligent torts consist of different types of duties. Duty is when a person with a legal duty to another is required to act, reasonably, under the circumstances to avoid harming the other person. near examples of this are duty to rescue and duty to invitees. Duties are basically an obligation that one person is legally bound to perform for another. In comparing the two types of torts we find that intentional torts are torts that people hold against other people. Negligence also others but it is a failure to perform that causes the injury or dirty action. Anexample of this comparison is the intentional tort of battery and failure to perform the duty to rescue. When I commit battery I cause harm to another, when I fail to perform the duty to rescue the other individual also suffers harm but it is because I failed to act. In contrast intentional torts are actions act against another and negligence is when I fail to take action on another. Next I will discuss the tort action of stochasticity with contractual relations and participating in a rupture of fiduciary duty. prophylactic with contractual relations protects the right to enjoy the benefits of legally binding agreements. It provides a remedy when the defendant intentionally induces another person to ruin a contract with a plaintiff. Interference with contractual relations requires intent to interfere.The existence of a contract is the difference between tortuous interference and the more difficult to prove tortuous interference with prospective contractual relations. The most famous event of tortuous interference was Pennzoil v Texaco which occurred in 1983 (Bagley, 2013). Similarly a defendant who knowingly participates in, or induces a breach of fiduciary duty by another commits the tort of participation in a breach of fiduciary duty. Lastly, I believe that if god grounds exist for the interference, such as exists in the JPMorgan Chase case then I should be able to prevail in the tort action. Lastly, I will cover how banks protect the software that allows for online transactions. Most banks protect the customers who participate in online transactions through what is called the Online Banking Guarantee. This protection covers your banking and personal information. It is the banks responsibility to ensure the customers protection while the customer engages in onli ne transactions.In most if not all case the customer is 100% covered in the case of theft of funds. One of main defenses for software protection is through complex encryption systems. Another deterrent is simply the vast fall of software that is available for online banking. So between the wide array of software and encryption systems online banking transaction are relatively safe. In this paper I have covered several topics and they are as follows What actions Administrative Agencys take to be effective in preventing high-risk gambles in securities and banking, the elements of a valid contract and the duty of good faith and fair dealing between banks and consumers, comparing and contrasting intentional and negligent torts, the tort action ofInterference with contractual relations and participating in a breach of fiduciary duty, and lastly, how banks protect the software that they use for online banking.ReferencesBagley, C. (2013). Managers and the Legal Environment Strategies for the 21st Century, 7th Edition. Mason South-Western, Cengage Learning. Liberto, J. (2012) CNN Money. (n.d.). Retrieved manifest 1, 2013, from http//money.cnn.com/2012/05/22/news/economy/jp-morgan-senate/index.htm U.S. Commodity Futures Trading Commission. (n.d.). Retrieved March 1, 2013, from U.S. Commodity Futures Trading Commission http//www.cftc.gov/index.htm U.S. Securities and transfigure Commission. (n.d.). Retrieved March 1, 2013, from U.S. Securities and Exchange Commission http//www.sec.gov/ Weigand, T. (2013) . The Duty of Good Faith and Fair Dealng in Commercial Contracts in Massachusetts, Massachusetts Law Review. Retrieved 10Sep13