IRS Chief Frank Bisignano Spied on Colleagues When He Worked at JPMorgan

Frank Bisignano, the head of the Internal Revenue Service and Social Security Administration, sits atop two government organizations that store vast reams of sensitive financial data about every taxpayer.

More than a decade ago, he was co-chief operating officer at JPMorgan Chase JPM -0.65%decrease; down pointing triangle, another perch that gave him visibility and authority over every part of a massive financial institution. At the bank, people familiar with the matter said, he spied on fellow executives—using his authority over the security department and position to access sensitive information and internal communications without an apparent business justification.

The executive directed his security staff to use software to snoop in the email of rival executives—including Charlie Scharf, JPMorgan’s then head of consumer banking who is now the CEO of Wells Fargo, some of the people said. One executive said he suspected the spying and put a code phrase in his email, which he said Bisignano repeated back to him. 

Bisignano also accessed a draft complaint from the Federal Energy Regulatory Commission about a questioned derivatives trade that was a confidential document only seen by a few members of the legal department, some said. He also directed his staff to use software to surveil the work of employees, sometimes seeking to track keystrokes—which can show draft versions of written material—others said. 

The people said Bisignano’s goal was to keep a tight rein on employees and use the information to undermine his rivals as he expanded his responsibilities. No allegations are known to pertain to the improper access of customer information. 

Around the end of 2012, following years of complaints about his behavior, including allegations of disrespectful conduct toward colleagues and underlings and of the breaking of company norms around data collection, Chief Executive Jamie Dimon lost trust in him and told Bisignano he would support him finding a job elsewhere, people familiar with the matter said.