London whale scandal cost JPMorgan USD1 billion in fines

September 19
10:42 PM 2013

Last Thursday, arrangements from JP Morgan Chase & Co. with regulators were made public which totaled to a hefty USD1 billion. This was after the company's "London Whale" trading scandal and its two former employees were mandated to settle four civil investigations.

The settlement for the deal involved five authorities from the US and one from the UK. This was a milestone in the company's goal to clean up its legal affairs. However, this left JP Morgan additional cost and a big embarrassment.

The bank would still face criminal probes into the trading scandal. It would also still face conduct reviews during the energy trading probe, possible bribery in China and investigations on the sales of mortgage securities in the United States, said a Reuters report. The report added that investigators had also looked into its role in setting benchmark interest rates known as LIBOR.

The penalties include USD920 million for JP Morgan's London Whale trading scandal. The said scandal included admission of wrongdoing, which had been rare in the past settlements claimed by the US Securities and Exchange Commission. A second set of penalties included USD80 million charges for billing of credit-card customers for identity theft protection which were not given.

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