Dimon calls on SEC to probe Bear rumors

JPMorgan Chase & Co. chief executive James Dimon is calling on the Securities and Exchange Commission to investigate whether rumors spread by short sellers betting on The Bear Stearns Cos. Inc.’s impending doom helped sink the firm.
“Where there is smoke, there’s fire,” he said during an interview on “Charlie Rose” yesterday.
“This is even worse than insider trading. This is deliberate and malicious destruction of value and people’s lives,” Mr. Dimon said.
“They shouldn’t go to jail for a short period of time,” he said. “If I was the SEC, I’d find out who made the money and I’d investigate like they do when they come after us all the time — e-mails, phone records, you name it — and I’d find out.”
After nearly collapsing in mid-March amid the credit crunch, Bear Stearns entered into a deal to be acquired by JPMorgan Chase for the fire sale price of $2.2 billion, or $10 a share. Shareholder approved the deal in late May (InvestmentNews May 29). Both firms are based in New York.
In the days leading up to its near-collapse, shares of Bear Stearns plunged amid speculation that the company didn’t have sufficient access to fresh capital (InvestmentNews March 10).
JPMorgan has absorbed about 75% of Bear Stearns’ assets, Mr. Dimon said during the interview.