The U.S. Senate Permanent Subcommittee on Investigations accused JPMorgan in a 301-page report of hiding losses, deceiving regulators and misinforming investors. The panel’s chairman, Michigan Democrat Carl Levin, referred its findings to the SEC and Justice Department in April.
Former Chief Investment Officer Ina Drew and her head of international CIO, Achilles Macris, were among the top executives who left the bank, along with Chief Financial Officer Douglas Braunstein and Jes Staley, CEO of the investment bank. JPMorgan clawed back more than $100 million in pay from Drew and other managers.
‘Deceptive Conduct’
Drew, 57, told lawmakers at a March hearing that she wasn’t aware of what she called the “deceptive conduct” of her subordinates until after she left the bank.
JPMorgan’s board cut Dimon’s pay by 50 percent for 2012 after concluding that he bore some responsibility for the debacle. It also credited his leadership for the lender’s performance. JPMorgan reported a third straight year of record profit in 2012 with $21.3 billion in net income.
The Federal Bureau of Investigation and SEC have been scrutinizing public statements, calls with investors and an April 2012 earnings presentation by Dimon and Braunstein, Bloomberg News reported in June, citing five people with knowledge of the probes.
The criminal investigation has looked at, among other issues, whether traders painted the tape, a form of market manipulation that allows them to inflate the value of their positions, three of the people said at the time.
The criminal case is U.S. v. Martin-Artajo, 13-cr-00707, U.S. District Court, Southern District of New York (Manhattan).
The SEC case is Securities and Exchange Commission v. Martin-Artajo, 13-cv-05677, U.S. District Court, Southern District of New York (Manhattan).