JPMorgan CEO Dimon defends bank's disclosure

Jamie Dimon, CEO of JPMorgan Chase, testifies before the House Financial Services Committee on Capitol Hill in Washington on June 19, 2012. / AP Photo/Jacquelyn Martin

(CBS/AP) WASHINGTON - JPMorgan Chase (JPM) chief executive Jamie Dimon told lawmakers Tuesday that the bank did its best to fully inform investors about its risk strategy several weeks before it suffered a $2 billion-plus trading loss.

Appearing before the House Financial Services Committee, Dimon said that the bank trusted its methods for assessing risk and that the models used provided the best information at the time. The risk models are frequently updated, he said.

"We disclosed what we knew when we knew it," Dimon told the panel. 

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The Securities and Exchange Commission is examining whether JPMorgan's earnings report on April 13 gave adequate information on the risk model the bank was using. Earlier at the hearing, SEC Chairman Mary Schapiro told the panel "there could be" violations that would merit legal sanctions against the bank.

Schapiro also said it wasn't clear whether Dimon failed to speak truthfully when he dismissed reports of the trading loss in a conference call with analysts in April as "a tempest in a teapot."

U.S. Comptroller of the Currency Thomas Curry, whose agency is a key regulator of JPMorgan, told the panel that the loss appeared to be caused by "serious risk management weaknesses or failures at the bank."

Curry made similar remarks earlier this month at a Senate hearing.

Dimon told the Senate Banking Committee last week that he was aware of the trading strategy used by the investment operation that suffered the loss but that he didn't approve it. He said the bank made a mistake and that senior banking executives responsible for the loss will probably have their pay taken back by the company.

The loss disclosed last month has raised concerns that the biggest banks still pose risks to the U.S. financial system, less than four years after the financial crisis erupted.

[RealiteBites]

CBS, it'd be interesting to know how much money was donated to the members of Congress from JP Morgan.

I feel like if Congress were truly acting on behalf of the people, this guy should have been fired by the board of JP Morgan by now.

It all just feels so inbred and sleazy - like they're all in bed with each other, and they're not on anybody's side except their own ...

[Ourdoc1]

During his questioning is when someone should have stood up and yelled LIAR.

[baileycccc]

The bank has no problem putting their investors money at risk, but they won't put their own money in such risky investments. Heads need to roll.

[wfw3536]

Don't worry nothing will happen to Jamie as he was one of Obama's biggest campaign contributors along with his bag. They are very good friends as politicans are only interested in getting re-elected.

[hypnotoad72]

Actually, the special interests tend to "invest" in both parties. Usually more to the person they believe is going to win, for the sake of more handouts in return. And all paid for by us in the end...

[zEthics]

When elites are held in check, typically by effective legal mechanisms, everyone else in society does much better and sustained economic growth becomes possible. But powerful people - kings, barons, industrialists, bankers - work long and hard to relax the constraints on their actions. And when they succeed, the effects are not just redistribution toward themselves but also an undermining of economic growth and often a tearing at the fabric of society.

Please sign the petition to the U.S. Senate Banking and House Financial Services Committee asking for improved oversight of federal banking and market regulators.

To read more about what we're trying to do and to sign the petition, click here:
http://www.change.org/petitions/u-s-senate-banking-and-u-s-house-financial-services-committees-use-technology-to-provide-oversight-of-u-s-banking-and-market-regulators?share_id=HTpDoOQNJgpe=d2e

It'll just take a minute!

[Jaylah54100]

As long as we're content to continue to allow the fox to guard the henhouse, we can expect this kind of thing to continue indefinitely.

[Jaylah54100]

Did I say anything about current regulations or Dodd-Frank?

Gosh, looking back at my post, I sure don't see anything about either of those.

Totally changing the subject entirely and then claiming that your response has anything to do with a previous post is seriously disingenuous at best.

Now, go back to second grade, learn to read, and then test your new-found comprehension on this:

As long as we're content to continue to allow the fox to guard the henhouse, we can expect this kind of thing to continue indefinitely.

[Ourdoc1]

"Do you even know what you are talking about? The new 3000 pages MORE of regulations obviously did not help."

Are you THAT clueless? Maybe the 3000 pages didn't work because the RepukliCONS watered it down a hell of a lot before it was passed. Get a clue yourself moron...