JPMorgan Chase & Co., the biggest U.S. bank, said it’s under federal criminal investigation for practices tied to sales of mortgage-backed bonds that the Justice Department has already concluded broke civil laws.
U.S. investigators have subpoenaed a 2011 deposition of SAC Capital Advisors LP founder Steven Cohen, whose sworn statements on insider-trading compliance may hurt him as he tries to persuade regulators not to file a lawsuit with the potential to shut his $14 billion firm.
Julien Grout, a former JPMorgan Chase & Co. trader charged with trying to hide the bank’s record trading loss last year, is arguing to prosecutors that he was following orders from his then-boss, Bruno Iksil, people with knowledge of the matter said.
The $2.5 billion of settlements reached in the London interbank offered rate rigging scandal are compelling banks to hand over information in the probe of a separate financial benchmark tied to interest-rate derivatives.
Trading surges that temporarily boosted the value of credit derivatives held by JPMorgan Chase & Co. may provide clues about whether traders at the bank masked losses that have spiraled to $5.8 billion.
JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon went to Washington almost a month ago to see if U.S. Attorney General Eric Holder would settle a criminal probe of mortgage fraud at the bank if it paid more money to resolve related civil investigations.
In the end, billionaire Steven Cohen, one of the most successful hedge-fund managers of his generation, could end up getting banned from the business he dominated for an error of omission, not commission.