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
- 43 TV shows to watch in 2014
- Obama just kneecapped Jeb Bush and Chris Christie's 2016 prospects
- How science is accelerating our search for alien life
- The Hunger Games: Mockingjay — Part 1: 10 major differences between the book and the movie
- How to be the most productive person in your office — and still get home by 5:30 p.m.
- It's official: The religious right is calling it quits
- 6 tiny scientific mistakes that created huge disasters
- Inside Turkey's shadow war with ISIS
- 10 classic Sesame Street moments we wouldn't show today's kids
- The dangerously childish morality of liberal ObamaCare supporters
Subscribe to the Week