News / USA

US Senate Report Attacks Big Bank's Trades

From left, former JPMorgan Chase executives Ina Drew and Peter Weiland, and the company's Acting Chief Risk Officer, Ashley Bacon, testify before Senate Homeland Security Investigations Subcommittee, Washington, March 15, 2013.
From left, former JPMorgan Chase executives Ina Drew and Peter Weiland, and the company's Acting Chief Risk Officer, Ashley Bacon, testify before Senate Homeland Security Investigations Subcommittee, Washington, March 15, 2013.
VOA News
A new U.S. Senate report is sharply condemning the country's biggest bank, JPMorgan Chase, for its risky trading practices and lack of controls that resulted in a $6 billion trading loss last year.
 
Democratic Senator Carl Levin of Michigan, the chairman of the Senate panel investigating the bank's actions, summarized the findings of the 300-page report at a hearing Friday. The bank lost the money in its London office while making trades on securities known as derivatives, financial instruments that get their value from other assets.
 
"It exposes a derivative trading culture at JPMorgan that piled on risk, that hid losses, that disregarded risk limits, that manipulated risk models, that dodged oversight, and that misinformed the public," Levin said.
 
The legislator also said the scope of the bank's deceptions in hiding losses on the complex trades would make it difficult for Americans to have confidence in big banks.
 
"It is difficult to imagine how the American people can trust major Wall Street banks to prudently manage derivatives' risks when bank personnel can readily game or ignore the risk controls that are meant to prevent financial disaster in taxpayer bailouts," he said.
 
The Senate panel questioned key JPMorgan executives, including Ina Drew, the official who had overseen the trading office where the loss occurred. Drew worked at JPMorgan for 30 years but quit last year after the loss was disclosed. She told the lawmakers that her subordinates had misled her.
 
"Some members of the London team failed to value positions properly and in good faith and minimized purported and projected losses, and hid from me important information regarding the true risk of the book," she said.
 
JPMorgan's highly acclaimed chief executive, Jamie Dimon, at first called reports of the trading losses a "tempest in a teapot."
 
But several officials were ousted in the aftermath of the $6 billion loss, and the company on Thursday said it has "repeatedly acknowledged mistakes." The bank said its senior management "acted in good faith and never had any intent to mislead anyone."

You May Like

US Imposes Sanctions on Alleged Honduran Drug Gang

Treasury department alleges Los Valles group is responsible for smuggling tens of thousands of kilograms of cocaine into US each month More

At 91, Marvel Creator Stan Lee Continues to Expand his Universe

Company's chief emeritus hopes to interest new generation of children in superheroes of all shapes and sizes by publishing content across multiple media platforms More

Photogallery New Drug Protects Against Virus in Ebola Family

Study by researchers at University of Texas Medical Branch, Tekmira Pharmaceuticals is first looking at drug's effectiveness after onset of symptoms More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
African Media Tries to Educate Public About Ebolai
X
George Putic
August 20, 2014 8:57 PM
While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video Ferguson Calls For Justice as Anger, Violence Grips Community

Violence, anger and frustration continue to grip the small St. Louis suburb of Ferguson, Missouri. Protests broke out after a white police officer fatally shot an unarmed black teenager on August 9. The case has sparked outrage around the nation and prompted the White House to send U.S. Attorney Eric Holder to the small community of just over 20,000 people. VOA’s Mary Alice Salinas has more from Ferguson.
Video

Video Beheading Of US Journalist Breeds Outrage

U.S. and British authorities have launched an investigation into an Islamic State video showing the beheading of kidnapped American journalist James Foley by a militant with a British accent. The extremist group, which posted the video on the Internet Tuesday, said the murder was revenge for U.S. airstrikes on militant positions in Iraq - and has threatened to execute another American journalist it is holding. Henry Ridgwell has more from London.
Video

Video Family Robots - The Next Big Thing?

Robots that can help us with daily chores like cooking and cleaning are a long way off, but automatons that serve as family companions may be much closer. Researchers in the United States, France, Japan and other countries are racing to build robots that can entertain and perform some simpler tasks for us. VOA’s George Putic reports.
Video

Video In Ukraine, Fear and Distrust Remain Where Fighting has Stopped

As the Ukrainian military reclaims control of eastern cities from pro-Russian separatists, residents are getting a chance to rebuild their lives. VOA's Gabe Joselow reports from the town of Kramatorsk in Donetsk province, where a sense of fear is still in the air, and distrust of the government in Kyiv still runs deep.
Video

Video Five Patients Given Experimental Ebola Drug Said to Be Improving

The World Health Organization has approved the use of experimental treatments for Ebola patients in West Africa. The Ebola outbreak there is unprecedented, the disease deadly. The number of people who have died from Ebola has surpassed 1,200. VOA's Carol Pearson reports on the ethical considerations of allowing experimental drugs to be used.
Video

Video China Targets Overseas Assets of Corrupt Officials

As China presses forward with its anti-graft effort, authorities are targeting corrupt officials who have sent family members and assets overseas. The efforts have stirred up a debate at home on exactly how many officials take that route and how likely it is they will be caught. Rebecca Valli has this report.
Video

Video Leading The Fight Against Islamic State, Kurds Question Iraqi Future

Western countries including the United States have begun arming the Kurdish Peshmerga forces in northern Iraq to aid their battle against extremist Sunni militants from the Islamic State. But there are concerns that a heavily-armed Kurdistan Regional Government, or KRG, might seek to declare independence and cause the break-up of the Iraqi state. As Henry Ridgwell reports from London, the KRG says it will only seek greater autonomy from Baghdad.
Video

Video In Rural Kenya, Pressure Builds Against Female Circumcision

In some Kenyan communities, female genital mutilation remains a rite of passage. But activists are pushing back, with education for girls and with threats of punishment those who perform the circumcision. Mohammed Yusuf looks at the practice in the rural eastern community of Tharaka-Nithi.

AppleAndroid