JPMorgan Cut Ties With Trump After January 6th, Citing 'Reputational Risk'

Well, here's a rather significant tidbit that came out in court: JPMorgan Chase, one of the nation's biggest banks, actually pulled the plug on Donald Trump's personal and business accounts not long after the chaotic events of January 6, 2021. You know, the day the Capitol was breached. It's a revelation that, for many, perhaps wasn't entirely surprising but certainly confirms a pretty dramatic shift in the relationship between the former president and a major financial institution.

This admission came directly from Marianne Lake, who heads up JPMorgan's Consumer & Community Banking division, during testimony in a New York court. She was there as part of a rather tangled legal battle where Trump is suing a whole host of people and entities – including his former lawyer Michael Cohen, the Trump Organization, and indeed, JPMorgan itself. Trump's main beef? He's alleging breach of contract and, perhaps more keenly, significant reputational damage. He firmly believes the bank's decision was politically motivated, a claim that, predictably, adds a fiery layer to the proceedings.

But the bank, through Lake, painted a very different picture. She explained that JPMorgan operates with a dedicated 'risk committee' – sounds formal, right? – that meticulously evaluates its customers. The ultimate decision to close Trump's accounts, she clarified, wasn't a snap judgment from one person. Instead, it emerged from discussions within both their 'operating committee' and that very 'risk committee.' Their official reasoning? The accounts were 'de-risked.' Now, that's a bit of banking jargon, isn't it? What it really boils down to is that the bank felt the association had become too risky, citing 'escalated reputational risk' and, rather tellingly, the 'totality of the circumstances' surrounding the January 6th events.

And let's be clear, banks do this more often than you might think. They're constantly assessing the potential for legal, financial, and yes, reputational fallout from their clients. When a customer, particularly a high-profile one, becomes embroiled in controversy that could reflect poorly on the bank or even invite unwanted scrutiny, these institutions often make the tough call to part ways. It's a calculated business decision, you see, not necessarily a political one – at least, that's JPMorgan's stance here.

It's also worth noting that Trump wasn't the only one caught in this wave of 'de-risking.' JPMorgan also reportedly closed accounts belonging to Steve Bannon, another former Trump advisor, around the same timeframe. This suggests a broader, perhaps institutional, move to distance themselves from individuals linked to the post-election controversies. Trump's legal team, naturally, is trying its utmost to demonstrate political bias, arguing the bank's actions were anything but neutral. However, the bank is steadfastly asserting its prerogative to manage its own risks.

Adding another layer of complexity to this saga is the fact that this isn't Trump's first legal tango with Cohen and the bank. A previous lawsuit he filed against them was actually tossed out by a judge, who famously remarked that the allegations 'strained credulity.' So, as this latest legal battle unfolds, it's clear there's a lot more to uncover beneath the surface of what seems like a simple banking decision.