JPMorgan Chase, which accepted $25 billion in bailout funds, is moving ahead with plans to spend $138 million for two luxury corporate jets and the renovation of an aircraft hanger just north of New York City.
The financial giant will follow through with a longstanding plan to spend nearly $120 million for two Gulfstream 650 planes and another $18 million for a lavish renovation of a hangar at the Westchester Airport in White Plains, ABC News reports.
Although JP Morgan insists that it will repay taxpayers in full before it makes the purchases, corporate watchdog Nell Minow called the plans a “remarkably boneheaded decision” and “completely tone deaf.”
Company spokesman Joseph Evangelisti said the jet purchases are part of the financial giant’s normal aircraft replacement policy, and that JPMorgan Chase will repay all TARP money before it makes any payments. He declined to say whether the company had made any downpayments.
JPMorgan Chase currently has four jets at Westchester Airport, two of which would be replaced by the Gulfstream 650’s when they arrive in 2013, according to ABC. The Gulfstream 650 jets are described by their manufacturer as the “fastest,” “widest,” and “most comfortable” aircraft ever designed.
ABC News’s report described the planned hangar renovation as “lavish.” It noted descriptions to build “the premiere corporate aircraft hangar on the eastern seaboard,” using reclaimed wood, quarry tile and a “vegetated roof garden.”
Until now, JPMorgan Chase CEO Jamie Dimon has won strong praise for his ability to maintain a stronger balance sheet than many of his rivals, and for his compelling testimony before Congress. A longtime donor to Democratic causes, he has been repeatedly metnioned as a possible replacement for Timothy Geithner, should Geithner resign as Treasury secretary.
But the purchase of luxury items and payouts of huge bonuses by companies receiving bailout funds has been a source of growing public outrage, and now Dimon may find himself on the receiving end of the same fury unleashed at Citigroup’s Vikram Pandit and AIG’s Edward Liddy.
Earlier this year, Citigroup had to cancel delivery of a $50 million corporate jet under pressure from the Obama administration. More recently, insurance giant AIG has been demonized for awarding millions in bonuses to employees in its financial products subsidiary, who were responsible for the company’s meltdown.
Only two weeks ago, Dimon had expressed puzzlement at what he called “the constant vilification of corporate America.”
“I would ask a lot of our folks in government to stop doing it because I think it’s hurting our country,” Dimon said in a March 11 speech in Washington.
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