Legal costs for major U.S. banks top $100B


The U.S.'s six largest banks have accumulated legal costs of $103B so far since the financial crisis, Bloomberg calculates, noting that the figure is greater than the amount they've paid in dividends in the past five years.

Legal fees and litigation costs account for $56B and the rest is for payments to mortgage investors.

JPMorgan's (JPM) legal bill is $21.3B while it has allocated $8.1B for mortgage buybacks. Bank of America's (BAC) legal expenses are $19.1B and its repurchase provisions $28.6B. The other banks are Citigroup (C), Wells Fargo (WFC), Goldman (GS) and Morgan Stanley (MS).

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Comments (12)
  • leoss
    , contributor
    Comments (21) | Send Message
     
    That's why the only people getting rich are the lawyers, policy makers,
    CEO's.....screw the investors and the little guys
    28 Aug 2013, 05:12 AM Reply Like
  • drstocks
    , contributor
    Comments (62) | Send Message
     
    The US, instead of producing goods, has become a country of paper shufflers, lawyers and bureaucrats. Not to forget the military which also costs us hundreds of billions. Ok, let's sue each other between trips to McDonalds and Starbucks while other, inferior peoples work.
    28 Aug 2013, 05:21 AM Reply Like
  • keentolearn
    , contributor
    Comments (137) | Send Message
     
    They have wasted more money then the combined forex of lot ot african and asian nations. They could have bring prosperity in africa and earned the status of god.
    28 Aug 2013, 06:59 AM Reply Like
  • moneyTalksBSWalks
    , contributor
    Comments (194) | Send Message
     
    Yee haw, lawyer "investments" in the Dems are paying off. Big time.
    28 Aug 2013, 07:59 AM Reply Like
  • The Geoffster
    , contributor
    Comments (4296) | Send Message
     
    Legal costs include settlements to those the banks ripped off.
    28 Aug 2013, 08:38 AM Reply Like
  • rube123
    , contributor
    Comments (2145) | Send Message
     
    JPMorgan devoted $21.3 billion to legal fees and litigation since the start of 2008.

     

    looks like the bulk went to ambulance chasers to me
    28 Aug 2013, 09:02 AM Reply Like
  • StockGaming.com
    , contributor
    Comments (58) | Send Message
     
    That's one of the reasons their stocks are so depressed and under-priced.

     

    Once all of the costs are behind them, they will recover and normalize.
    28 Aug 2013, 08:50 AM Reply Like
  • gwynfryn
    , contributor
    Comments (6478) | Send Message
     
    You wish, SG! I expect things to carry on getting worse as we are now well into the final part of this cycle of civilisation; history has run this scenario with just about every cycle that's ever been, but the Establishment either remain ignorant of the lessons of history, or else chose to ignore them. Why not? The decadent phase is always a great time to be rich, well, at least up until the final collapse, when the advantage once more reverts to those who can grow their own food...
    28 Aug 2013, 09:40 AM Reply Like
  • convoluted
    , contributor
    Comments (2435) | Send Message
     
    I know the lawyer bashing is popular-but, it's either the law of man or the law of the jungle. Certainly, the legal system-like the health care system-can be more in line with our loftier expectations.
    We have a long way to go in our evolution. Recall that it wasn't so many years ago that we had trial by combat; and, our forefathers actually murdered people for witchcraft.
    Disclosure: passed 3 state bar exams (stopped in many more bars along the way).
    28 Aug 2013, 09:58 AM Reply Like
  • gwynfryn
    , contributor
    Comments (6478) | Send Message
     
    What we do have is the law of the legal professions, and they are not in the least interested in what works best for "man" in general, but rather what is most lucrative for their own kind.
    28 Aug 2013, 10:21 AM Reply Like
  • what do I know
    , contributor
    Comments (1044) | Send Message
     
    convoluted: you take the comment personally. The comments are not as much against lawyers as it the systems, it looks like banks administrations and the lawyers colluded together, seem like they were having fun at the expense of the "investors", if there was something other than the "Board" style, if the stockholder were permitted to vote on these issues ,probably the banks won't have these kinds legal expense. But, Bloomberg present only one side of the scenario, there is both the plaintiff and defense, Bloomberg should have also presented AIG, the big villain in this, and Fanny MAE and the Freddy Macs, etc. Mr. Benmoshe is probably telling the Board only of positive consequence but AIG is also have legal expense, so it makes sense to have some cool head prevail here, majority of crime happened because the villains don't know some law is broken.
    28 Aug 2013, 10:41 AM Reply Like
  • mccuskerjim
    , contributor
    Comment (1) | Send Message
     
    Public Cost of J. P. Morgan Chase’s Ongoing Financial Circus.
    9/29/2012

     

    A recent Wall Street Journal article concerning the ongoing monetary and political travails of J.P. Morgan Chase, blatantly stated that Government had no right interfering in the matter of the London Whale trading scandal since he basically felt that “…the trade losses had no public costs.” Apparently the author does not consider J.P. Morgan’s Stockholders as part of the public entity and therefore no real costs to them were ever involved. Corporately speaking, he just might be on to something!

     

    In addition, the same author squarely places most of the blame for J.P. Morgan Chase’s ongoing problems squarely at the feet of Congress and the DODD/FRANK Law, which is only 20% implemented after almost five years on the books, and which, if in full effect prior to 2008 would have gone a long way to preventing the financial crisis brought about by some of the very banks the author is defending.

     

    Around the same time frame, a Bloomberg article, in its opening stanza, declares that, “The six biggest U.S. banks, led by JPMorgan Chase & Co. (JPM) and Bank of America Corp., have piled up $103 billion in legal costs since the financial crisis, more than all dividends paid to shareholders in the past five years.” (Emphasis added). Obviously no “Public Costs” involved here?

     

    The Facts are quite irrefutable and the case is clearly stated when you realize that since 2008 J.P. Morgan’s 3.8 Billion shares of outstanding stock each have contributed almost an additional $10.00 per share in Corporate Litigation Fees as their cost of doing business J.P. Morgan’s (Jamie Dimon) way, and it looks as though they will be on the hook for an additional $11-15B before the dust begins to clear. I suppose that J.P. Morgan Chase’s Board cutting Jamie Dimon’s annual salary in half, but still giving him both titles of Chairman and CEO, is only a reflection of the austere times the bank is facing….. and has absolutely nothing to do with Jamie’s almost daily (?) interaction with his “Public” and any of their “Costs”.

     

    Of course, on reflection, there is absolutely no reason for our elected Senators and Representatives to stick their political noses into any of this……even with their help; it couldn’t possibly get any worse!
    30 Sep 2013, 04:12 AM Reply Like
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