A $6 billion trading loss forced rare SEC charges against J.P. Morgan

Evidence

The “London Whale,” the chief investment officer at J. P. Morgan’s office in London, specialized in large and complex investment packages. His deals lost the company over 6 billion. Two other traders were accused of falsify-ing records to hide the losses from those trades (Hurtado, 2015). A loss that immense is hard to sweep under the rug, however powerful the control Wall Street wields over federal regulators. In a rare move, under a new chairperson, the SEC filed civil charges against the firm. J.P. Morgan settled the charges by agreeing to pay an unprecedentedly large 200 million fine, admitting the SEC’s charges, and acknowledging publicly that it broke federal laws on securities. — Albert Bandura, Moral Disengagement, 1504