“JPMorgan Chase has been criticised by US bank regulators for failures in risk management that led to a multibillion-dollar loss on credit derivatives by a trader dubbed the “London whale”.
The formal enforcement actions by the Office of the Comptroller of the Currency and the Federal Reserve are the first regulatory response tied to JPMorgan’s ill-judged bets on derivatives, which caused more than $6bn in losses.
Separately, Jamie Dimon, chief executive of the bank, will have his bonus for last year docked by the board in a sign of personal accountability for the failures, according to people familiar with the situation. Mr Dimon earned more than $20m in 2011.
The OCC faulted the bank for deficient governance, ineffective internal audit processes and inadequate management of its financial models. The Fed accused JPMorgan’s senior management of failing to provide adequate information to its board of directors.”
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