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Two former JPM traders charged over 'London Whale' trade
by David Campbell on Aug 15, 2013 at 07:47
US prosecutors have charged two London-based former JP Morgan traders over their alleged involvement in last year’s $6.9 billion ‘London whale’ trading loss.
New York attorney general Preet Bharara declined to say whether other traders were still facing charges but said that the investigation remained ongoing.
Former traders Javier Martin-Artajo and Julien Grout were charged with conspiracy, wire fraud, false filings to the regulator and false book and record keeping. If convicted, the two will face jail terms.
'The complaints tell a story of a group of traders who got in over their heads, and to get out, doubled down on a series of risky positions,’ said FBI assistant FBI director in charge George Venizelos in a statement.
‘In the first quarter of 2012, boom turned to bust, as the defendants, concerned about losing control to other traders at the bank, fudged the numbers on their daily book and in some cases completely made them up. It brought a whole new meaning to “cooking the books”.’
Prosecutors said that the two traders repeatedly lied about the fair value of the trades they had open as they sought to cover up the extent of their losses.
Under US regulations derivative traders are required to report the value of their trading books on a daily basis.
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