Courtesy of Pam Martens.
JPMorgan's Whale of a Problem
Last week the business media was buzzing about a newly ramped up investigation into the $5.8 billion in losses thus far reported by JPMorgan’s Chief Investment Office in what is now dubbed the London Whale trade. The Senate’s Permanent Subcommittee on Investigations, Chaired by Carl Levin, is reportedly interviewing former personnel who worked in that division, based in London as well as New York.
Levin’s powerful subcommittee has jurisdiction to conduct investigations into a wide array of issues, including fraud and abuse, and corporate crime.
The real breaking news on this matter, however, occurred on May 13 of this year when Levin appeared on Meet the Press. Host David Gregory asked Levin what should be the price for what occurred at JPMorgan. Levin has this to say:
“In terms of past activities, that’s in the hands of people who are assessing whether there was any criminal wrongdoing. That’s still in the hands, as far as I know, of the Justice Department and the New York prosecutors.”
The operative words in the above statement are “past activities” and “criminal.” That strongly suggested that improprieties in the Chief Investment Office had been going on for quite some time – not the few months that the public had been led to believe. That view was buttressed when JPMorgan later reported that there may have previously been mismarking of values in the Chief Investment Office.
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