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

Sunni-Shi’ite Divide Threatens Middle East Stability

Analysts say ancient dispute that traces back to Islamic Revolution is fueling modern day unrest More

Shifting Demographics Lie Beneath Racial Tensions in Ferguson

As Missouri suburb morphed from majority white to majority black, observers say power structure remained static More

Video Artists Shun Russia's Profanity Law

Restriction is toughest since Soviet era, though critics reject move as patronizing and ineffective act of censorship in line with a string of conservative morality laws More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Native Bees May Help Save Cropsi
X
Deborah Block
August 22, 2014 12:23 AM
U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video Native Bees May Help Save Crops

U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video US Defense Officials Plan for Long-Term Strategy to Contain Islamic State

U.S. defense officials say American air strikes in Iraq have helped deter Islamic State militants for the time being, but that a broad international effort is needed to defeat the extremists permanently. Defense Secretary Chuck Hagel warned Thursday that the group formerly known as the Islamic State in Iraq and the Levant, or ISIL, is better organized, and financially and militarily stronger than any other known terrorist group. Zlatica Hoke has more.
Video

Video Drug-Resistant Malaria Spreads in Southeast Asia

On Thailand’s border with Myanmar, also known as Burma, a malaria research and treatment clinic is stepping up efforts to eliminate a drug-resistant form of the parasite - before it spreads abroad. Steve Sandford reports from Mae Sot, Thailand.
Video

Video Gaza Conflict, Hamas Popularity Challenge Abbas

The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Nigeria's 'Nollywood' Movie Industry Rolls in High Gear

Twenty years after its birth in a video shop in Lagos, Nigeria's "Nollywood" is one of the most prolific film industries on earth. Despite low budgets and whirlwind production schedules, Nigerian films are wildly popular in Africa and industry professionals say they hope, in the future, their films will be as great in quality as they are in quantity. Heather Murdock has more for VOA from Lagos.
Video

Video UN Launches 'Biggest Aid Operation in 30 Years' in Iraq

The United Nations has launched what it describes as one of the biggest aid operations in 30 years in northern Iraq, as hundreds of thousands of refugees flee the extremist Sunni militant group calling itself the Islamic State. As Kurdish and Iraqi forces battle the Sunni insurgents, the fighting has forced more people to flee their homes. Kurdish authorities say the international community must act now to avert a humanitarian catastrophe. Henry Ridgwell reports for VOA from London.
Video

Video Cambodian American Hip Hop Artist Sings of Personal Struggles

A growing underground movement of Cambodian American hip hop artists is rapping about the struggles of living in urban America. Most, if not all of them, are refugees or children of refugees who came to the United States from Cambodia to escape the Khmer Rouge genocide of the 1970s. Through their music, the artists hope to give voice to immigrants who have been struggling quietly for years. Elizabeth Lee reports from Long Beach, California.
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.

AppleAndroid