Oversight, Regulation

JPMorgan to pay $1 billion in London Whale penalties

240px-J_P_Morgan_Chase_Logo_2008_1.svgRegulators announced on Thursday that JPMorgan Chase & Co. will pay $1 billion in penalties to settle four investigations into its London Whale trading losses and wrongful billing of credit card customers.

The Federal Reserve’s penalty order against the bank holding company pointed to its failure to inform its own board, as well as the central bank, of inadequacies in its risk management systems. In January, the Fed issued an order requiring JPMC to correct the problems after $6.2 billion in losses stemming from its London CIO, Reuters reports.

JPMC will pay $920 million in penalties to the regulators and another $80 million for billing credit card customers for identity protection services they never received. The company was also ordered by the OCC to shore up its debt collection practices.

JPMorgan CEO Jamie Dimon and several other senior executives have admitted missteps that led up to the Whale losses. The company, however, still faces a criminal investigation, though Dimon and other executives maintain that none of the bank’s senior executives intentionally misled investors, according to Reuters.

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