Investigation is widening into the trading blunders committed at JPMorgan Chase & Co. (JPM: Quote) and the enforcement division of the Commodity Futures Trading Commission, or CFTC, is issuing subpoenas requesting emails and other company documents, The Wall Street Journal reported.
The financial services giant said early last month that since March 31, its Chief Investment Office incurred hefty mark-to-market losses in its synthetic credit portfolio that proved to be riskier than expected.
The derivatives trades by the firm's Chief Investment Office led to a loss of over $2 billion and resulted in the departure of its Chief Investment Officer Ina Drew.
The federal regulators are now making use of powers obtained from the Dodd-Frank financial overhaul law that became effective last year.
The probe will look into the explanations made by the firm's traders to their superiors about the wrong bets. The inquiry is at a preliminary stage and is not restricted to what the traders said.
Events at JP Morgan are already under the scanner of the Justice Department and the Securities and Exchange Commission. The U.K's Financial Services Authority also is said to be probing the trades, which were made by London-based traders.
JPM closed Thursday's regular trade up by 0.6 percent at $33.15 on a volume of 42.13 million shares.
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by RTT Staff Writer
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