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September 20, 2013

JPMorgan admits it broke securities laws in 'London Whale' case

“JPMorgan Chase & Co. has made a rare declaration for Wall Street: The nation’s biggest bank admitted it broke the law.

The financial giant acknowledged Thursday that it violated securities laws and agreed to pay fines of $920 million as part of settlements over the “London Whale” trading debacle. The Securities and Exchange Commission and other government authorities alleged the bank suffered widespread breakdowns in controls and management.

Regulatory settlements are commonplace for big financial firms. But admitting to violations was seen as a first for a major U.S. bank after the financial crisis prompted calls for a crackdown on Wall Street wrongdoers.

“‘It’s a huge embarrassment,’ said Erik Oja, a banking analyst at S&P Capital IQ who covers JPMorgan. ‘The admission of guilt is a landmark.'”

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Other critics noted that no individual executives were named either.

“‘The behavior and culture on Wall Street must change, and that will only happen when CEOs and other senior executives are personally charged and held responsible,’ said Dennis Kelleher, president of the financial watchdog group Better Markets.”

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Read full LA Times article here

 
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