by Christopher Freeburn | August 27, 2013 11:23 am
The former JPMorgan Chase (JPM) official who was supposed to monitor the activity of the trader who racked up $6 billion in losses on derivatives trades has surrendered to police in Madrid.
American authorities have charged Javier Martin-Artaio with falsifying records, conspiracy, wire fraud and allowing the bank to make erroneous statements in regulatory filings. An arrest warrant has been issued for him in the U.S., the Wall Street Journal notes.
Prosecutors have also charged Julien Grout in the case. Authorities accuse the men of deliberately concealing hundreds of millions in trading losses at the bank’s U.K. office, generated by Bruno Iksil, who has been dubbed the “London Whale.” A French national, Grout is thought to be in France and is reportedly negotiating with authorities.
The U.S. will request Martin-Artaio’s extradition. He has been released from custody, but must remain in Spain while he fights the U.S. extradition demand.
Iksil will not be prosecuted after cooperating with prosecutors.
Earlier this year, the U.S. Senate’s Permanent Subcommittee on Investigations issued a report alleging that JPMorgan’s CEO James Dimon failed to disclose the full impact of the London Whale’s losses to regulators.
The bank initially claimed a loss of just $2 billion, but later conceded that the losses were much higher.
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