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August 15, 2013

Former JPMorgan Employees Charged for Hiding "London Whale" Losses 
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New York prosecutors have unveiled charges against two former employees
of the banking giant JPMorgan Chase for the so-called "London Whale"
trades that cost the bank more than $6 billion and derailed financial
markets worldwide. A Senate probe earlier this year accused JPMorgan
Chase of misleading the public, manipulating documents and ignoring
warnings from within its own ranks as the losses piled up. On Wednesday,
U.S. Attorney Preet Bharara announced the first charges to stem from the
case.

U.S. Attorney Preet Bharara: "The defendants deliberately and repeatedly
lied about the fair value of billions of dollars in assets on JP
Morgan's books in order to cover up massive losses that mounted month
after month at the beginning of 2012. Those lies mislead investors,
regulators and the public and they constituted federal crimes. As has
already had been conceded, this was not a tempest in a teapot, but
rather a perfect storm of individual misconduct and inadequate internal
controls."

The two defendants reside in Europe and it is unclear if they will face
extradition.

 

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