Friday, Jul 29, 2016
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SETTLEMENT

JPMorgan to pay $100M, admit fault

Traders tried to conceal losses, regulators say

WASHINGTON — The “London Whale” is the gift that keeps giving for regulators.

JPMorgan Chase & Co. has agreed to pay the latest in a string of fines for the disastrous trades, and admit wrongdoing, this time in a settlement with the U.S. Commodity Futures Trading Commission.

The bank agreed to pay $100 million and admit its traders acted recklessly, the CFTC said Wednesday.

The settlement came one month after it paid $920 million to four other U.S. and British regulators to resolve probes of the bank’s $6.2 billion in derivative losses involving its chief investment office.

The so-called “London Whale” episode has proved to be one that just about every regulator the bank deals with has wanted to investigate and collect fines for.

The Justice Department, even after filing criminal charges against two former JPMorgan traders who allegedly helped conceal the losses, is still looking at bringing action against the bank.

“We are pleased to be able to put behind us another aspect of the CIO trading matter by the resolution of the CFTC investigation,” JPMorgan spokesman Joseph Evangelisti said.

The settlement comes as JPMorgan continues to deal with regulators and U.S. authorities on other fronts.

The bank trying to negotiate a global settlement with federal prosecutors over its role in the packaging and selling of faulty mortgage-backed securities that could result in a potential $11 billion settlement.

On Friday, JPMorgan said it has set aside up to $23 billion in reserves to pay for all its potential legal bills to come.

The CFTC charged the bank with violating a prohibition on manipulative conduct when it traded in the credit default swaps that the bank had built an outsized exposure to by early 2012 and then needed to quickly exit to try to minimize the losses.

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