It looks like JPMorgan Chase may be ready to admit wrongdoing over the ill-fated trades by its London Whale. The big bank is apparently moving towards settling with the Securities and Exchange Commission over the $6 billion losses made by the "Whale" and his team. On Friday, the New York Times reported British authorities are planning to arrest two traders for falsifying records related to these trades.
"When we've seen investigations in the past, banks -- any firms, companies -- get to usually make a settlement by saying they neither admit nor deny wrongdoing," says the Wall Street Journal's Sudeep Reddy. "JPMorgan, if it were to admit just in some way it were wrong in a formal investigation settlement -- that would be a big step. Now, Jamie Dimon, the head of the bank, has already made some of these acknowledgements. But there's a bigger issue here that we need to -- that we hope -- that the government will get into: How do we know in real time that these big banks, our biggest financial institutions, aren't making disastrous bets that will bring down parts of the financial system? That's the really critical issue that we have to get into."
At his press conference today, President Obama also seemed to make something of a Freudian slip -- referring to Janet Yellen as "Mr. Yellen" when asked about who he might want as the next head of the Federal Reserve.
"I think it's an unfortunate slip of the tongue, especially given a lot of the discussion about how gender has influenced perceptions of the two candidates," says the New York Times' Catherine Rampell. "I don't know that it necessarily means anything about any new information about which candidate that he might be leaning toward. The general perception seems to be that Larry Summers is the frontrunner, but I'm a little hesitant to read the tea leaves too much in to this Freudian slip."
And we've got #Longreads picks from the Wrappers.
Sudeep Reddy suggests:
- In one of the best-timed business profiles ever, Fast Company looks at Amazon.com’s quest to transform the retail landscape as founder Jeff Bezos buys The Washington Post.
- Local law-enforcement agencies nationwide are using civil forfeiture laws to take money and property from people who haven’t been convicted of a crime. The New Yorker dives into many of the most enraging cases.
- Scott Andrew Selby, who co-authored a book about diamond theft, takes us into the process. In one case, thieves rented an office and safe-deposit box in the building they planned to rob and spent two years preparing for the heist.
Catherine Rampell picks:
- For men in academia, having children can be a slight career advantage. For women, it is often a career-killer.
- The sacrosanct mortgage interest deduction.
- There's an open market for buying fake receipts in China, used to evade taxes and defraud employers.