JPMorgan Chase will settle with regulators for nearly $1 billion for the London Whale trading fiasco and other lapses in the banking giant’s oversight and controls, the Federal Reserve announced Thursday.
In the midst of a blizzard of regulatory and legal problems, the Fed slapped the bank with a $200 million penalty for “deficiencies in risk management.” In January, the Fed ordered JPMorgan to take action on practices the regulator deemed as “unsafe or unsound.”
As a result of its risk management issues, JPMorgan will pay a total of $920 million to various regulators. In addition to the Fed’s fine, the U.S.’s largest bank will fork over $300 million to the Office of the Comptroller of the Currency, $200 million to the Securities and Exchange Commission and approximately $220 million ($137 million pounds) to the United Kingdom’s Financial Conduct Authority.
In a sharply worded decision, the Fed faulted JPMorgan’s “inadequate oversight” over its chief investment office, which eventually morphed into the legal and regulatory nightmare now known as the “London Whale.” The high-stakes wagers have cost the bank more than $6 billion and led to the indictment of two former JPMorgan employees.
After initially dismissing the matter as “a tempest in a teapot,” JPMorgan CEO Jamie Dimon has since struck a more contrite tone. In a statement, Dimon said his bank has “accepted responsibility,” adding that the settlement was part of an effort to turn the page.
“We will continue to strive towards being considered the best bank—across all measures—not only by our shareholders and customers, but also by our regulators,” said Dimon. “Since these losses occurred, we have made numerous changes that have made us a stronger, smarter, better company.”