REPORT: The Bank Of England Smelled Something Fishy In JP Morgan's London Office Years Ago


Photo: Wikimedia Commons

The saga of JP Morgan’s London whale continues.New details continue to emerge regarding the JP Morgan’s Chief Investment Office, which booked recently billions of dollars in losses after gigantic trades gone wrong.  Those trades were executed by a trader that many refer  to as the London whale.

According to the Wall Street Journal’s David Enrich,

More than a year before J.P. Morgan Chase Co. racked up billions of dollars in losses from bad trades in its London investment office, Bank of England officials raised concerns internally about potential risks arising from some of the office’s activities, but didn’t formally alert other regulators, according to people involved in the central bank’s talks.

In late 2010, employees at the central bank worried that the London arm of J.P. Morgan’s Chief Investment Office had come to dominate some important corners of the city’s financial markets—including residential mortgage-backed securities—and they were concerned about the potential impact that could have on the stability of U.K. markets, these people said.

Even if the BoE did know, it’s not clear if they could’ve done anything about it anyway.


NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at