After announcing that it had recorded a $5 billion second quarter profit, despite a $4.4 billion mega-loss due to bad bets, JPMorgan said Friday that a number of traders may have hidden losses that now amount to $5.8 billion for the year. The development could "result in criminal charges" against those employees. The big bets, now known as the "London Whale trades," were made on corporate debt using derivatives, and when they were first revealed in May, the company estimated then that the loss was $2 billion. JPMorgan said that in the coming weeks the bad bets could bring about another $1.7 billion in losses, but that the problems at the company's Chief Investment Office (CIO) have been fixed. At least two CIO employees have left JPMorgan since the revelation, and an investigation is ongoing.
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- China's leader is telling the People's Liberation Army to prepare for war
- How to save money: 12 great personal finance tips
- Diagnosing the Home Alone burglars' injuries: A professional weighs in
- How I lost all my money
- 43 TV shows to watch in 2014
- The best books we read in 2014
- Why Pakistan won't hunt down the terrorists within its borders
- The religious right isn't retreating — it's reforming
- How to be the most productive person in your office — and still get home by 5:30 p.m.
- How academia's liberal bias is killing social science
Subscribe to the Week