One day after JPMorgan Chase & Co. CEO Jamie Dimon threatened to take action against employees who stole COVID-19 relief funds, several workers have reportedly been fired.
The Financial Times reported the multinational financial services holding company took the action after it discovered some of its staffers had allegedly deposited Economic Injury Disaster Loan (EIDL) funds in their checking accounts. A program of the Small Business Administration (SBA), it is designed to provide cash to businesses that are experiencing a temporary loss of revenue due to the coronavirus.
Separate from the SBA’s Paycheck Protection Program (PPP), the EIDL program offers grants of up to $10,000 and low-interest loans to businesses hurt by the pandemic. While PPP loans are distributed by banks, EIDL funds are distributed directly by the SBA.
A source told the news outlet that although the employees who allegedly stole the EIDL funds were not acting in their capacity as JPMorgan employees, they violated the bank’s code of conduct.
A spokesperson for the bank declined to comment.
FT reported the wrongdoing was discovered after the SBA instructed banks to investigate any potentially suspicious activity related to the EIDL loan program because of concern about potential fraud.
The cases accounted for a very small number of the total suspicious activity uncovered by JPMorgan, the source told the FT. It’s unclear how many staffers were terminated.
On Tuesday (Sept. 8), JPMorgan employees returned to work following the Labor Day weekend to discover a company email accusing some of them of potentially committing a crime.
The memo was sent to 256,710 employees from the bank’s operating committee led by Dimon. It said while the pandemic brought out the best in many workers, some customers abused the government’s coronavirus relief programs.
“Unfortunately, we’ve also seen conduct that does not live up to our business and ethical principles and may even be illegal,” the email said.
At the end of April, JPMorgan told its small business clients that the New York-based financial services company provided nearly $18 billion in relief to cash-strapped businesses. The average loan was $81,000, and about half of the applications came from businesses with fewer than five employees.