JPMorgan Agrees to Pay $920 Million for London Whale Loss

[kpete]

Source: Bloomberg

JPMorgan Chase & Co. (JPM), seeking to end probes of a $6.2 billion trading debacle, admitted to violating federal securities laws and agreed to pay about $920 million for failing to implement adequate controls and providing incomplete information to regulators and its board.

Senior management knew in April 2012 that the bank’s chief investment office in London, which was responsible for the loss, was using aggressive valuations that hid $750 million in losses, the Securities and Exchange Commission said today in a statement. Some executives “expressed reservations” at signing off on JPMorgan’s first-quarter earnings filings last year as required under the Sarbanes-Oxley Act, the SEC said.

The settlement resolves claims by the SEC, the U.S. Office of the Comptroller of the Currency, Federal Reserve and the U.K. Financial Conduct Authority. The Justice Department and Commodity Futures Trading Commission are among agencies still investigating the trading loss at the CIO, a unit of the New York-based bank that was supposed to help reduce risk and manage excess deposits. JPMorgan said today it was notified by the CFTC that its staff intends to recommend enforcement action.

“JPMorgan failed to keep watch over its traders as they overvalued a very complex portfolio to hide massive losses,” George S. Canellos, co-director of the SEC’s Division of Enforcement, said in the statement. “JPMorgan’s senior management broke a cardinal rule of corporate governance and deprived its board of critical information it needed to fully assess the company’s problems and determine whether accurate and reliable information was being disclosed to investors and regulators.”

Read more: http://www.bloomberg.com/news/2013-09-19/jpmorgan-chase-agrees-to-pay-920-million-for-london-whale-loss.html

[Wilms]

1. Where are they going to get the money to pay that off?

Oh, wait. From us.

[bhikkhu]

2. That's one of the arguments against fining or taxing corporations

It really doesn't hold water.

They get the money from their own holdings, which goes as an expense against earnings, which reduces their profits, which reduces the amount of money they can pay as dividends to shareholders and the attractiveness of the corporation to investors. If they must make up for that by raising fees or whatnot, that makes them less competitive, to people who pay attention to what they pay for banking. Both ways you look at it the fine reduces the effective size of the corporation.

[GeorgeGist]

3. Have you seen this man?

Wanted for Crimes against Sanity

[Wernothelpless]

5. that's the smile of a man laughing all the way to his own bank ...

He could commit murder and fraud and maintain the same demeanor ... a true sociopath ...

[Amonester]

8. He's not aware he is a true sociopath, since

he's just applying the same 'screw you' methods and shenanigans all the other true sociopaths in his field practice.

[dixiegrrrrl]

4. If investors do not know by now

what a crooked business JP is, they deserve any losses.
The firm just lost 6.2 BILLION and then tried to cover it up, which would make me wonder what else they are lying about.

fortunately, it is not like they are playing with real money.

[truth2power]

6. $920 million. How much would that be to you and me? About .50 cents? n/t

[november3rd]

7. Admits to $6B Crime

But nobody's going to jail? Huh? Time to call Django and Dr. Shulz!