RENEE MONTAGNE, HOST:
NPR's business news begins with criminal indictments for traders.
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MONTAGNE: A U.S. grand jury has indicted two former employees of JPMorgan Chase for their role in what's known as the London Whale trading disaster. Meanwhile, federal regulators could slap the bank with a civil fine of hundreds of millions of dollars.
NPR's Jim Zarroli has more.
JIM ZARROLI, BYLINE: JPMorgan Chase acknowledged last year that rogue traders in its London office had lost some $6 billion in derivatives trading and managed to conceal the losses from senior rank officials for weeks.
Yesterday, the two traders were indicted for securities fraud and wire fraud. Several published reports also said that the SEC and other federal regulators are about to fault the bank for inadequate internal controls and failing to supervise employees. The reports were later confirmed by a source who asked not to be named.
Officials at the bank are reportedly weighing whether to pay a fine of as much as $700 million and acknowledge wrongdoing. Often in the past, regulators have allowed financial companies to pay fines without admitting they did anything wrong. But the SEC has made clear lately that it wants to avoid such settlements. The SEC declined to comment yesterday, as did the bank.
The settlement is expected to be announced sometime this week. But it probably won't end the matter for the bank. The regulator that oversees the derivatives market, the Commodity Futures Trading Commission, has said it won't join any broader settlement and will press ahead with its own case.
Jim Zarroli, NPR News.
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