The three directors who oversee risk at JPMorgan Chase include a museum head who sat on American International Group Inc.’s governance committee in 2008, the grandson of a billionaire and the chief executive officer of a company that makes flight controls and work boots. What the risk committee of the biggest U.S. lender lacks, and what the five next largest competitors have, are directors who worked at a bank or as financial risk managers. The only member with any Wall Street experience, James Crown, hasn’t been employed in the industry for more than 25 years…The committee, which met seven times last year and hasn’t changed its composition since 2008, approves the bank’s risk- appetite policy and oversees the chief risk officer, according to the company’s April 4 proxy statement. [Bloomberg]
JPMorgan Risk Committee Directors Big On Life Experience, Wall Street Experience Less So
By Bess LevinComments (70)
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You know what they say: You can’t choose your family, but you can choose your financial planner. Or something like that. One of the great things of being in charge of your money is choosing who (if anyone) will help you manage it. The choice isn’t always an easy one. How will you know that your planner is reputable and trustworthy?
These five red flags may be good indications of whether the financial planner sitting across from you is someone you should trust with your money. LearnVest Planning also provides an innovative 7-step program for your money where you work one-on-one with a financial planner. To see if this program is right for you, start with a free financial consultation.
1. She Isn’t Certified
“There are a lot of good planners out there who aren’t Certified Financial Panners™,” says Samantha Vient, CFP®, of LearnVest Planning Services. “However, CFPs® are required to adhere to the CFP® Board’s standards of professional conduct.We believe it’s always a good idea to work with someone who has the CFP® designation, which is issued after completing a CFP® Board-approved personal financial planning curriculum, passing a rigorous exam issued by the Certified Financial Planner Board of Standards, meeting experience requirements and passing an ethics and background check.
2. He Offers to Manage Your Money for “Free”
Financial planners are usually paid in one of two ways: Either through fee-only, which can be a set fee, hourly, retainer or a percentage of the assets they manage for you, or through commission, which means the planner is paid each time he buys or sells an investment.Fee-only payment structures can be more desirable to some clients, as there’s no financial incentive based on assets under management for a planner to buy or sell, whereas working on commission encourages planners to make trades, rather than solely look out for your best interest—called a “fiduciary” duty. (You want to be sure that the planner you choose is a fiduciary.)
LearnVest Planning Services provides the services of fee-only Certified Financial Planners™. Get started for free with a 15-minute financial consultation.
3. She Says She Outperforms the Market
“If a financial planner tells you that she can outperform the market, that’s a major red flag,” Vient explains. “In fact, due to government regulations, it’s illegal to advertise statements that promise a specific return.”Outperforming the market—that is, getting better investment returns than the market average—is extremely difficult to do consistently, and requires taking a lot of risks with your investments. It’s rare to find a financial planner who can consistently outperform the market—and results are never guaranteed. Either way, in the pursuit of these high returns, she’ll be exposing your investments to much higher risk than you may be comfortable with.
Instead, look for a CFP® who, when looking at your portfolio, can advise on proper asset allocation based on your risk tolerance and time horizon, as well as through economic ups and downs.
4. She Doesn’t Ask About Your Financial Goals
“Your planner isn’t just there to crunch the numbers,” Vient advises. “She’s helping you make a plan for your money and your life. You should be looking for someone who has similar values to you.”Ideally, you’ll likely want to work with someone who is in a similar life stage. Are you a parent? A planner with children may be better able to understand your need to save for college. Does your CFP® have a specialty? Some planners have an area of expertise, like insurance, estate planning, divorce or retirement—a fact you might want to consider if that’s a particular need of yours.
When meeting a potential planner, remember that you’re allowed to ask questions about their experience and priorities: “Do you think it’s more important to save for retirement or pay off debt? How do you feel about supporting kids through college? How do you mitigate investment risk as your clients get older?”
The choices you make with your money are intensely personal. The person who helps you make these choices should be able to understand and accept your financial priorities, and help you use your money to meet them.
5. His Management Style Makes You Uncomfortable
Financial planners can manage your money for you or manage your money with you. As different people have different needs when it comes to money management, there is no right way to work with a planner—it’s up to you to decide how hands-on you want him to be.
When you sign on with a financial planner, there will be a written agreement of how the two of you will manage your money. Read this carefully, and ask questions if you’re unsure about anything. Are you signing your accounts over to this planner? Will he check in with you before making a trade, or when rebalancing your accounts? If you’re uncomfortable with anything in the agreement, bring it up immediately.Learn more about LearnVest Planning and our financial planners by visiting learnvest.com. To book your free consultation today, email FA_Support@learnvest.com or complete your request online.
LearnVest Planning Services is a registered investment adviser. The opinions expressed in this article are that of LearnVest Planning Services, a registered investment adviser. The advice provided may not be suitable for your individual situation and you should discuss your situation with a financial professional.
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I don't see a problem here.
– Jon C.
Real people with real lives are how a real bank keeps it real.
You know Jon C(orzine) actually had, like, A LOT of Wall Street experience, right? Ran this li'l place called Goldman Sachs for a while? Ringing any bells?
Hell yes!
-JD
For real.
Yes, No, Yes, Yes
obviously, being a politician for four years negated his "LOTS" of wall street experience
Fuck you, whale! And fuck you, dolphin!
– Japanese JPM Shareholder
Yeah, that totally makes sense.
/heavy sarcasm
As usual, your comment is as stupid as it is unfunny.
Oh yeah, forgot about that, he did a marvelous job there…
Rose: You're a "Wong"?
Gus: Well, my mother was Irish.
Rose: And your father?
Gus: Wasn't.
Remind us again what he fucked up at GS?
http://features.blogs.fortune.cnn.com/2011/10/23/…
Then he got thrown out by Paulson for being inept, went on to fuck up Jersey (even more so than it normally is) and then bankrupt MF Global while losing a bil of customer money.
Are you really defending this idiot? Or is it a joke cause you're bored since nothing is going on today?
What the risk committee of the biggest U.S. lender has, and what the five next largest competitors lack, are nepotic director apointments who guarantee their families will continue to do business with JPMorgan.
- Cpt. Obvious
Could Geezer Oil Trader maybe regale us with what risk management was like 25 years ago? Please?
Him getting pushed out by Paulson had nothing to do with being "inept."
And free museum passes!
How about taking it public?
-Just About Every GS Employee Circa 1999-2008
Bess, this person's IP address coming from Hoboken by any chance?
Last I checked the GS people who made a shitton of money off it going public weren't too upset in the end.
Take it to Minetta's gentlemen….
GOH, let me know if Bess does not get back with you on this, I can look it up.
Is riding a blow-up whale the NKI and I missed the email/memo/comment? I thought Jamie was still the boxer.
This should surprise exactly nobody who has ever worked at JPM.
Love, the adults are speaking can you please go back to the kids table.
Obviously that's a picture of the risk committee…..
….grandson of a billionaire or not, that haircut is inappropriate for whale riding
I'd be fucking glad to. In the good old days when a real trader exercised wearing fucking headband and tubesocks …and maybe some shorts…fucking Exxon didn't require a letter of credit and would do business with anyone. Then some fuckheads shit in that nest …I think it was some firetrap called Houston Oil and Refining..and Exxon became in the mid-1980s the hardest company to deal with and fuck you if you don't like getting paid 120 days from delivery! In the early 1980s when the was NO FUCKING CRUDE OIL…no ANS, little or no Indonesian, no shale economically available, etc., companies like Exxon had their people tell your Geezer that a month-to-month evergreen fucking crude oil sale to them meant "life of the field" and they could make life difficult if you didn't perform. Then that FUCKHEAD Sheik Your Money made a FUCKING SPEECH at Oxford University, home of the famous fucking shoe I guess, and said the Saudis were going to TAKE BACK THEIR MARKET SHARE by PRODUCING and SELLING THE SHIT OUT OF ALL the OIL They Could PRODUCE!!! Oil prices fell from 35 to 9 per barrel and that fuckhead at Exxon walked on my P+ $1.75/bbl sale. "But what about 'life of the field" and all that other stuff" I stammered to him? Sorry is all he said and sorry he was!!!
Risk management? If you were a dumbass in Abilene, TX, with 8 fucking transport trucks hauling oil to a Mobil LACT unit you could get $8 million in trading credit from them. The general procedure in Houston after decontrol in 1981 was to give anyone with an asset $20 million of trading credit before LCs were needed. (Yes, I know you shit birds in the natgas biz call them LOCs but it's the same fucking thing.) Paribas provided for almost all of the LCs in Houston in 1980-1983 and then their fucking New York office wanted in on the gigantic cash flow so Houston people started shitting on their New York brethren's LC rates. It was fun to watch Houston get a little merde on their face. Risk management? There was no risk management. A risk manager back then would have been a person who challenged your genius, didn't believe in your superhuman trading powers and would have MADE YOU TAKE A LOSS!!! Of all people!!! If you had a loser on the trading books you moved it to refining. That's why refined products traders hate their oil traders. Risk management? We spent more time looking for lipstick on our underwear than we did for bad trades!! Risk management?back in 1981 I took a marketer for Anadarko and his wife to a Rodney Dangerfield show and in th middle of the show she leaned over and said to me, "I like Rodney but I'd really like to see Frank Sinatra….." YES MA'AM!! That was risk management in the 80s. Either that or fire a trader after a $6 million loss, whichever came first. Pardon the expression.
Keeping usless committee people on a usless committee ..
Wow….I'm shocked.
Was the whale first or last?
Damn, I needs to be on that board…I KEEPS IT REAL!
It's like summoning an old, angry genie in a bottle.
Being on boards is fun and a great way to meet people.
I know- isn't it great?
I can smell GOTs Old Spice from here.
does it matter? the third chick is a yes either ways…
It's been said before, and I'm sure much of Houston would say the same, but this could be my dad talking about the pussified brand of witchcraft "…all these overeducated fucks"* practice today.
* I am typically the proxy for all the overeducated fucks of the world.
Bravo, sir. Bravo.
–D.O.U.G.
Thanks for that, old timer.
My version of the good old days is remembering quaaludes.
(Or trying to).
Not about GS more about Democratic Party.
So are we seriously thinking that having financial sector heavyweights on the risk management committee would reduce the amount of risk that JPMC took on? In your dreams. I thought the big hitters were the ones who got us into this mess in the first place.
Bob Rubin had finance experience. Thought Citi should take more trading risk. Didn't work out.
- M&A guy who would have all traders rounded up.
I am hearing that Jamie Dimon is talking about trigegring "clawbacks" in Employee Restricted Stock Awards.
Why should employees subsidize management's fraud ? Shouldnt these losses be born by shareholders who then in turn lien on the Board of Directors to get new management ???
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I guess sometimes, pure talent can be just as effective as experience. It's just a matter of finding health and safety consultants with enough talent to do the job.
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Ok.
Here's the backstory on James Crown's Aspen Skiing from Aspen Skollie:
This is the story about a small town folk singer and his “anthem for local working people.” It’s about corporate bullying, irony and karma. It’s the story of “Big Money.”
Dan Sheridan, a 20-plus year Aspen local, released an album in 2003 that included a song called “Big Money.” While the song has been popular among some locals, Sheridan has never gained much notoriety past the Aspen corridor of Highway 82. That is until recently. On January 1, 2010, Sheridan played a gig at Sneaky’s Tavern in the new and incomplete Snowmass Base Village. [Yesterday’s front page story was: Skico accused of fraudulent actions in Base Village condo sales. It was written by local author Brent Gardner-Smith.] A group in the small crowd requested “Big Money” and Sheridan obliged them by playing the song. Sheridan said he had noticed “dudes in full-length fur coats and cowboy boots” but that he “got the feeling that everyone wanted to hear it.”
While no one ever heard from the man-fur sporting tourists, there was apparently one person in the crowd who did not want to hear it. An Aspen Skiing Company Vice President complained to the Director of Food and Beverage, and on the following Monday Sheridan was fried. By that Wednesday the Aspen Times published a story detailing the events, and Jeff Hanle, the Skico’s spokesman, was quoted as saying, “An artist can express himself how he wants. But that doesn’t mean we have to provide him the stage.” Suddenly everybody was talking about “Big Money.”
The newspaper was flooded with letters to the Editor with such headlines as “Censorship by Skico,” “Downright Pathetic,” and “Boycott Skico,” and by Thursday the Aspen Skiing Company was calling Sheridan to say that he could come back and play any song except for “Big Money.” Aspen Daily News printed the story “Skico welcomes Sheridan back without “Big Money””. Hanle called the incident a “PR debacle” and said that he hoped Skico could put the incident behind them and move on.
Unfortunately for Skico, that was just the beginning. More letters poured into both Aspen newspapers,… and even Pitkin County Commissioner Jack Hatfield dissed the Skico for all to see on Grassroots TV. The original story became the most read article on the Aspen Times website, and it was picked up by Denver’s Westword.
Skico moved on and decided to ride the holiday wave by promoting Aspen Snowmass in major cities like Chicago, San Francisco, and L.A. The company took its first billboard ads since 1958 with the headline “It’s Time to Fly” featuring hometown sweetheart Gretchen Bleiler. However, the story would not die.
While the Skico was posting billboards along the 405 in L.A., the L.A. Times was printing an article titled “Folk song strikes a touchy chord in Aspen”, which can now be found on their website under Home/Collections/Wealthy People. Instead of giving Sheridan a quiet warning and letting a couple of urban cowboys take offense at a small show, Skico officials alienated Aspen locals and undermined their own major advertising campaign. Corporate karma can be a real bi#ch.
The story finally reached Gawker: “Take heart, hippie communist folk singer Dan Sheridan… you are quite correct. Big money ruins everything. And that’s gonna suck for the rich, if they ever leave their cocaine-and-expensive-hooker-strewn Jacuzzis.”
The good news is that Dan Sheridan is now a folk hero, and everyone wants to hear “Big Money.” Still, is an apology authentic if it only comes after you have been called out? Would Sheridan still have a job if the Aspen Times had never printed that story? No one at Skico has yet to take responsibility for the firing of Dan Sheridan. There is no transparency and no accountability, and perhaps that is why this story continues to play.
You have to wonder what is going on at Aspen Skiing Company. In a new story Curtis Wackerle for the Aspen Daily News ask why Skico has stopped delivery of the newspaper to its hotel properties. Hanle is quoted as saying that the amount of newsprint on display at the properties “was just overwhelming” and that it had nothing to do with the Daily News running the story “Skico’s green efforts didn’t include Residences at The Little Nell.”
“An artist can express himself how he wants. But that doesn’t mean we have to provide him the stage” sounds a lot like “A newspaper can say what it wants, but that doesn’t mean we have to provide it the circulation” or advertise with it. It’s not so much a bullet to the Daily News as it is a sucker punch. Skico fail.
-Skollie Life
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