Toddsterpatriot
Diamond Member
Who covered depositors' losses?
"The hook for The Journal’s screed was the recent decision of Joon Kim, the acting United States attorney in Manhattan, to drop charges against two former JPMorgan Chase traders involved in the 'London Whale' trading debacle in 2012, when a group of traders lost some $6.2 billion after making big — and decidedly wrong — bets on derivatives using depositors’ money.
"They worked in a group at the bank responsible for investing depositors’ money that isn’t being lent out.
"Mr. Kim apparently decided to drop the case because a key witness was no longer reliable.
"The Journal praised that decision, claiming it was a good one since 'no customers’ funds were lost' and because the bank made $5 billion in profit during the second quarter of 2012.
"But Jesse Eisinger, the author of a new book about the Justice Department’s failure to prosecute bankers, traders and executives in the aftermath of the financial crisis, said in an email that the 'standard for fraud' is not whether customer deposits were lost (and they would have been for sure had all depositors demanded their money all at once), nor whether the bank made a profit during the quarter that the loss occurred.
"'That’s irrelevant,' he said. What’s important is that these men and women knew what they were doing was wrong.
"Instead of a reason to celebrate, Mr. Kim’s decision to drop the London Whale case, which began under his predecessor Preet Bharara, really was another example of prosecutorial failure."
The Whale That Should Not Have Gotten Away
Who covered depositors' losses?
What part of "Their depositors didn't lose a dime" was too complex for you?
not whether customer deposits were lost (and they would have been for sure had all depositors demanded their money all at once),
Why would all depositors have tried to withdraw over $1.3 trillion (TRILLION!) in deposits all at once?
