JPMorgan Silent Partner Revealed in Whale Fiasco
http://www.bloomberg.com/news/2013-03-21/jpmorgan-silent-partner-revealed-in-whale-fiasco.html
One of the best parts about last weeks Senate hearing on JPMorgan Chase & Co. (JPM)s London Whale trades is that we finally got a clear picture of whose side the regulators were on during the early days while the banks executives tried to contain the unfolding debacle.
Even when officials at the U.S. Office of the Comptroller of the Currency knew that JPMorgan had misled the public, they did nothing to make the company set the record straight. The regulators didnt merely keep quiet while JPMorgan spread falsehoods. Their silence made them complicit.
Last April, when Douglas Braunstein was still JPMorgans chief financial officer, he said the banks regulators were fully aware of what the credit-derivatives traders at its chief investment office had been doing. His assurances came a week after the first stories about the London Whale scandal broke in the press. This was before JPMorgans acknowledgement in May that it had a serious problem, which eventually added up to more than $6 billion in trading losses.
We are very comfortable with our positions as they are held today, and I would add that all of those positions are fully transparent to the regulators, Braunstein said on JPMorgans April 13 quarterly earnings conference call. They review them, have access to them at any point in time and get the information on those positions on a regular and recurring basis as part of our normalized reporting.