JPMorgan and the ongoing saga of the London Whale

Much as JPMorgan Chase would love to forget about 2012's London Whale disaster, this story is just not going away.

Authorities are reportedly closing in on former JPMorgan employees Javier Martin-Artajo and Julien Grout — two of the three traders allegedly responsible for a bad derivatives bet that lost the bank an estimated $6.2 billion, then trying to hide the amount of the loss from their bosses in New York. Meanwhile, Bruno Iksil, the London Whale himself, is reportedly cooperating with the authorities in exchange for possible leniency.

And then there's the fallout for JPMorgan Chase itself. Historically, the SEC has allowed banks to pay a fine and "neither admit nor deny" wrongdoing in similar cases of employee misbehavior. In the case against former Goldman Sachs trader Fabrice Tourre earlier this summer, for example, Goldman was able to settle for $550 million — and no admission of guilt.

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But after fielding criticism for this policy, the SEC may well require JP Morgan to acknowledge some wrongdoing as part of a settlement. "Making JPMorgan the first example of the SEC's new policy would send a clear message to Wall Street that no financial institution, even one of its largest and most profitable, is immune from being required to admit to a violation," said Peter J. Henning in The New York Times.

If JPMorgan did have to admit some guilt in order to finally put the London Whale in the SEC's rearview mirror, future class action suits against the bank by investors, which tend to follow SEC cases, could use the admission to help force the bank to pay dearly in damages.

Of course, there are plenty of analysts who think JPMorgan will be just fine, regardless. Gina Chon puts the argument this way at Quartz: