JP Morgan hid mistakes as trade losses grew, Senate investigation finds

[Eugene]

Source: The Guardian

Heidi Moore in New York
guardian.co.uk, Thursday 14 March 2013 23.24 GMT

JP Morgan's $6.2bn London Whale trading debacle was born out of secretive trades and creative bookkeeping as the bank attempted to limit losses using a practice that one regulator called "make believe voodoo magic", a Senate investigation has concluded.

The report by the Senate subcommittee on investigations, published on Thursday, detailed a series of failures in which accounts were hidden and trades were valued incorrectly to minimize losses. It also alleged that regulators were kept in the dark, a head trader's concerns went unheeded and a $51bn trading portfolio ballooned to $157bn in three months.

The inquiry follows JP Morgan's own internal investigation in January and provides the first look into the emails and internal discussions at the bank around the infamous Whale trade. It centers on the secretive JP Morgan chief investment office, which accounted for as much as one-sixth of the bank's assets last year.

The 300-page report alleges that JP Morgan hid losses, did not share information with its regulators, and misled the public. The report also blames the bank's regulator, the Office of the Comptroller of the Currency, and recommends reforming the way regulators oversee derivatives, the complicated financial instruments that played a role in the Whale trades and the financial crisis.

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Read more: http://www.guardian.co.uk/business/2013/mar/14/jpmorgan-senate-investigation-london-whale

[sakabatou]

1. They're to big to prosecute, right, Holder?

[yourout]

2. Way to big.......you can commit fraud to the tune of billions and no jail but get caught with $100..

of pot and it's off to the slammer.

[BlueManFan]

3. Eric Is Out of The Office

prosecuting grandma and grandpa for smoking medical weed and playing internet poker. Priorities you know!

[SamKnause]

4. Cons

Why bother with an investigation ?

Our esteemed Attorney General, Eric Holder has taken care of the matter.

He has created a two tier justice system in this country.

Too Big To Jail
Too Big To Fail
Too Big To Prosecute
Too Big To Regulate

Our Science challenged Supreme Court has declared that corporations are people. They have given corporations more rights than living breathing humans.

If anyone is surprised at how corrupt and inept our government is at handling crisis after crisis in this country, you have not been paying attention.

Committees formed to protect the rights of 'we the people' are on the take.

Our unions are making deals with countries across the globe that destroy our wages and ship our jobs overseas.

Corruption and dog eat dog is the result of a government that sold 'we the people' and the future of this country to the highest bidders.

They sold something they did not own.

They sold our future.

They sold our right to make a living wage.

The sold our rights to Life, Liberty and the pursuit of Happiness.

[cstanleytech]

5. Sam, Holder didnt create this mess.

Mind you I am not saying he hasnt done his part in assisting protecting the bankers but the problem of the banks and those with money and power not being prosecuted was with us long before Holder was even in office largely because they have bought those off in elected office.

[SamKnause]

8. Holder

Thanks for your reply and input.

I am aware that Holder did not cause this problem.

It is his job to solve this problem.

He has failed miserably, as has the entire Obama administration.

I do not recall any other Attorney General stating that banks or corporations are too big to fail, too big to jail, too big to prosecute, or too big to regulate.

They all sicken me.

[Kablooie]

6. So how many unpaid PA's will go to jail over this? And how big a bonus will the management get?

[Munificence]

7. This is just the start

...of things to come, it all has been smoke and mirrors, even the stock market run-up.

I thought thw government was letting JPM off the hook for the "Too Big" but maybe not. JPM has manipulated the markets heavily over the past 4 years with direct contact with our gov and the Fed....figured they'd go unscathed as they know way to much about this fake economy and the act of "can kicking" that has been done over the past 5 years.

Chickens are coming home to roost!