What’s More Impressive than JPMorgan’s $920 Million Penalty? The CEO Admitted Fault

Posted in Banking , Financial News • September 19, 2013

JPMorgan Chase

JPMorgan Chase bank was charged on Thursday morning by the Securities and Exchange Commission for the actions of one of its London-based traders, Bruno Iksil. Iksil, now referred to as the “London Whale,” incurred more than $6 billion in trading losses and attempted to conceal the severity of the losses by overvaluing his investments.

JPMorgan Shoulders Responsibility for London Whale

JPMorgan Chase was cited for “misstating financial results and lacking effective internal controls to detect and prevent its traders from fraudulently overvaluing investments to conceal hundreds of millions of dollars in trading losses,” the SEC said in a statement.

As the country’s largest bank by assets, JPMorgan must now pay $920 million in fines for the incident. Additionally, it publicly admitted to slacking off on overseeing trading activities and the aftermath of the London Whale incident – an uncharacteristic move, seeing as financial institutions in hot water usually pay off settlements without acknowledging fault.

“We have accepted responsibility and acknowledged our mistakes from the start, and we have learned from them and worked to fix them. We will continue to strive towards being considered the best bank — across all measures — not only by our shareholders and customers, but also by our regulators. Since these losses occurred, we have made numerous changes that have made us a stronger, smarter, better company,” said Jamie Dimon, Chairman and Chief Executive Officer of JPMorgan Chase.

Photo credit: Steve Jurvetson

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