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It seems Jamie Dimon and Ina Drew are going to be protected from the fallout of the Manhattan prosecutor’s “London Whale” investigation of JP Morgan.Ben Protess and Azam Ahmed of DealBook reported this morning that investigators have focused on four individuals based in London who worked for the team responsible for the $6 billion loss.
Of the four, Bruno Iksil, the so-called “London Whale”, has returned to France after leaving the bank, posing a possible complication because France does not extradite its citizens.
Protess and Ahmed wrote:
“The scope of the inquiry suggests that the problems were isolated to a handful of executives and traders in an overseas division, and did not reflect a fundamental weakness with the bank’s culture and leadership.”
Authorities are using phone recordings, emails, and instant messages sent within the group to build a case against these former JPMorgan employees, but the bar for prosecution is high. Investigators need to prove the bankers “intentionally masked losses by mispricing the positions.”
With JPMorgan set to release third quarter earnings on Friday, the trading loss could come under further scrutiny as the bank continues to unwind the bet.
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