Conservative investor pulls JPMorgan resolution, cites changes addressing 'politicized finance'

[May 21, 2024]  By Ross Kerber

(Reuters) - A conservative shareholder has withdrawn a resolution filed for a vote at Tuesday's annual meeting of JPMorgan, according to the investor's representative, who said the move reflects changes the Wall Street bank has made to take more account of diverse viewpoints.

JPMorgan's meeting was to include Proposal 11, a call for the bank to report on how the bank's policies impact employees "based on their religion (including religious views) or political views."

Jerry Bowyer, a fund consultant who represents David Bahnsen, the head of the family trust that filed the resolution, said it was withdrawn in light of several steps the bank has taken that show it pulling back from political tests for customers.

One factor, Bowyer said, was the bank's decision to drop a requirement that merchants using its WePay service not accept payments tied to risks like allegations of racism or sexual harassment.

He also cited a note that JPMorgan included in a recent climate report stating it serves customers "regardless of political, social or religious viewpoints."

And, Bowyer said the family trust appreciated recent comments by JPMorgan CEO Jamie Dimon including critical remarks about proxy advisers in Dimon's annual letter to investors.

"These were all positive signs of them recognizing politicized finance as a problem," Bowyer said.

JPMorgan and other global banks have been under fire from conservative activists who charge they have cut off clients over right-leaning political views, sometimes referred to as "debanking." At the same time other investors have pressed banks to take more account of social and environmental issues.

An archived webpage shows that as recently as August, merchants using JPMorgan's WePay service had to agree to not accept payments or use the service in connection with "social risk issues." The bank defined those as "subject to allegation and impacts related to hate groups, systemic racism, sexual harassment and corporate culture."

A view of the exterior of the JP Morgan Chase & Co. corporate headquarters in New York City May 20, 2015. REUTERS/Mike Segar/File Photo

That language no longer appears on the WePay terms of service.

The Alliance Defending Freedom, which calls itself a Christian law firm, said it first discovered the new language in November. JPMorgan did not immediately say when the language was changed, but said the old language dated to its purchase of WePay, which closed in December 2017.

Asked about the new language promising to serve customers regardless of their viewpoints and other communications that Bowyer said led to the withdrawal of the resolution, a bank representative said the material only reflected longstanding policies.

“While the language may look new, the policies and practices are not. We support clients around the globe and in every state in the U.S., across industries, religions and political affiliation," the representative said via e-mail.

"We do not and would not close an account due to a client's political or religious affiliation, and we’re making sure to articulate that long-held policy wherever and whenever possible," the representative added.

JPMorgan defended its political neutrality after WePay suspended services in 2021 to Defense of Liberty, a Missouri political action committee that planned to host an event for Donald Trump Jr, eldest son of the former U.S. president. JPMorgan said at the time the suspension was a mistake and moved to reinstate service.

Jeremy Tedesco, senior counsel for the Alliance Defending Freedom, said the WePay shift was significant.

"These policies give people a foothold to demand banks cancel services. So eliminating that is not a small thing," he said.

Tedesco's group plans to issue on Tuesday a new edition of its “Viewpoint Diversity” index on major U.S. companies, criticizing many for having vague or subjective terms of service.

(Reporting by Ross Kerber in Boston; Editing by Lincoln Feast.)

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