The CEO said that JPMorgan adopted a strategy late last year to reduce risk, but it backfired in its investment operation by heightening risk instead. The bank has named a new leader for the investment operation that was responsible for the loss.
A key regulator of JPMorgan, Thomas Curry, the U.S. comptroller of the currency, suggested last week that the bank lacked strong controls to contain risk in its investment operations.
And The Wall Street Journal reported Tuesday that some senior JPMorgan executives, including the chief financial officer and chief risk officer, were told about risky trading in London two years before the losses came to light.
Dimon himself knew of some of the trades and sometimes spoke with the traders involved, the Journal reported, citing unnamed people familiar with the matter.
The Securities and Exchange Commission is reviewing what JPMorgan told investors about its finances and the risks it took before the loss.
In April, in a conference call with analysts, Dimon dismissed concerns about the bank's trading as a "tempest in a teapot." Later, adopting a more conciliatory stance, he conceded that he'd been "dead wrong" to minimize those concerns.
Dimon, grandson of a Greek immigrant and son of a stockbroker, is no stranger to Washington. His reputation for cost-cutting and perceived mastery of risk earned him respect in the capital, particularly during the crisis, which JPMorgan weathered with relatively few scars.
Since the crisis, Dimon has been an outspoken voice against stricter financial regulation. He has complained that lawmakers and regulators have gone too far in an overhaul of the financial system and might be slowing the economic recovery.
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