House Speaker Boehner says reforms wouldn’t prevent JPMorgan loss

John Boehner

House Speaker John Boehner said during an interview on ABC’s “This Week” that financial reforms would not have prevented JPMorgan Chase & Co.’s $2 billion trading loss and that those responsible should be held accountable.

“I don’t believe there’s anything in Dodd-Frank that would’ve prevented this activity at JPMorgan,” Boehner said, according to News Service.

JPMorgan CEO Jamie Dimon announced the $2 billion bad trading loss earlier this month, and the number has since climbed to $3 billion, The New York Times reports.

“There’s no law against stupidity,” Boehner said, according to News Service. “No law against stupid trades. And as long as depositors’ money wasn’t at risk and as long as there’s no risk of a taxpayer bailout, they should be held accountable by the market and their shareholders.”

The bad trade resulting from portfolio mismanagement by JPMorgan CIO Ina Drew raised questions as to whether the activities that contributed to the loss would be considered illegal under the controversial Volcker Rule. The Volcker Rule is a Dodd-Frank provision that prohibits banks from engaging in proprietary trades with client money, though it does extend an exemption to risk-hedging activities.

News of the loss revitalized arguments by Dodd-Frank proponents that tougher regulation is needed to prevent the same activities that led to the 2008 financial crisis. Boehner, however, said that Dodd-Frank needs major revisions.

“There are big problems for this law, and it needs—it needs some big changes,” Boehner said, News Service reports.

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