JPMorgan Caught in Swirl of Regulatory Woes
Government investigators have found that JPMorgan Chase devised “manipulative schemes” that transformed “money-losing power plants into powerful profit centers,” and that one of its most senior executives gave “false and misleading statements” under oath.
The findings appear in a confidential government document, reviewed by The New York Times, that was sent to the bank in March, warning of a potential crackdown by the regulator of the nation’s energy markets.
The possible action comes amid showdowns with other agencies. One of the bank’s chief regulators, the Office of the Comptroller of the Currency, is weighing new enforcement actions against JPMorgan over the way the bank collected credit card debt and its possible failure to alert authorities to suspicions about Bernard L. Madoff, according to people who were not authorized to discuss the cases publicly....Ms. Masters is the person who headed up JPM's carbon trading and had that monstrosity reached our shores would have run a derivatives empire in the notional trillions.
...In the energy market investigation, the enforcement staff of the Federal Energy Regulatory Commission, or FERC, intends to recommend that the agency pursue an action against JPMorgan over its trading in California and Michigan electric markets.
The 70-page document also took aim at a top bank executive, Blythe Masters. A seminal Wall Street figure, Ms. Masters is known for helping expand the boundaries of finance, including the development of credit default swaps, a derivative that played a role in the financial crisis.
The regulatory document cites her supposed “knowledge and approval of schemes” carried out by a group of energy traders in Houston. The agency’s investigators claimed that Ms. Masters had “falsely” denied under oath her awareness of the problems and said that JPMorgan had made “scores of false and misleading statements and material omissions” to authorities, the document shows....MORE
Because that didn't happen she was left to being JPM's Head of Global Commodities and since September 2012 has the additional assignment to lead regulatory affairs for the corporate and investment bank.
She is the most powerful woman on Wall Street.
Last year's "J.P. Morgan's Blythe Masters On The Blogosphere, Silver Manipulation, Gold-Axed Clients And Doing The "Wrong" Thing (JPM)" has links to some of our Blythe posts including "Brilliant: Maxwell's SILVER Hammer Came Down on Blythe Masters' Head (SLV; JPM)" which begins:
The oeuvre of songs about serial killers is not as limited a genre as one may at first suspect.
Most everyone, with a little thought, will come up with Mack the Knife (rape, murder, arson) and of course the Talking Heads' Psycho Killer ("psycho killer, qu'est-ce que c'est?").
As part of the British Invasion the Rolling Stones contributed Midnight Rambler (Boston Strangler) and Sympathy for the Devil (Nazis, Communists, Satan).
Best of the bunch has to be the Beatles' Maxwell's Silver Hammer (kills his girlfriend, his teacher and the sentencing judge).
Blythe Masters is the head of commodities trading for J.P. Morgan and was one of the co-inventors of Credit Default Swaps which played such a large part in the financial meltdown of 2007-09.
Ms. Masters urged regulators to distinguish between tools and their users: “Tools that transfer risk can also increase systemic risk if major counterparties fail to manage their exposures properly.”
I'm assuming the reader is familiar with the run in silver and the conspiracy theories about JPM's positioning....
