Senator Johanns calls on Dimon to testify on JPMorgan’s $2 billion loss

Mike Johanns

Sen. Mike Johanns (R-Neb.), a member of the Senate Banking Committee, recently called for JPMorgan Chase & Co. CEO Jamie Dimon to testify about the financial giant’s recent $2 billion trading loss.

“I’d be anxious to have a hearing specifically focused on this issue and specifically request that Dimon appear,” Johanns said, according to The Wall Street Journal.

The Senate Banking Committee has not called a formal hearing on the loss, though Chairman Tim Johnson said on Monday that the committee will likely discuss the loss over the course of scheduled Dodd-Frank hearings.

The loss has drawn criticism and questions about whether the trade leading to the loss could have been deemed illegal under the controversial Volcker Rule, a provision of Dodd-Frank that prohibits banks from engaging in proprietary trading.

“Until we understand what happened, it’s going to be impossible to say what the regulatory response may or may not be,” Johanns said, The Wall Street Journal reports.

Proponents of Dodd-Frank maintain that the loss was an example of the risky financial activities that the legislation is designed to prevent.

“They were betting like you would at the craps table in Las Vegas, and they bet the wrong way,” Sen. Harry Reid (D-Nev.) said, according to The Wall Street Journal.

Other rule-makers, however, warned against passing judgment before the facts of the incident become clear.

“Before people get out and start beating their chests and start making statements based on myths and perceptions, I really think we need to dig deep on this,” Sen. Bob Corker (R-Tenn.) said, The Wall Street Journal reports.

Corker added that circumstances surrounding the trading loss are complex and that he expects regulatory agencies to proceed with caution.

“The profile of this is so high, that they understand that this is going to really impact the amount of scrutiny that is on them as they continue to move through this rule-making process and candidly the amount of input they are getting,” Corker said, according to The Wall Street Journal.

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