First Class Action Lawsuit Over CIO Losses Filed Against JP Morgan

That didn’t take long.
Less than 48 business hours after Jamie Dimon held a conference call to inform investors that Bruno and Achilles had already cost the firm $2 Billion in a bad derivatives ‘hedge’, the first class action suit by JP Morgan shareholders has been filed in US District Court for the Southern District of NY.

The investors claim that the Defendants issued materially false and misleading statements regarding certain securities trading by the Company’s Chief Investment Office (“CIO”).
Specifically, the plaintiff claims that defendants allegedly misrepresented and/or failed to disclose that the CIO had engaged in extremely risky and speculative trades that exposed JPMorgan to significant losses.

While this is obviously a big new blow for The Morgue (though not unexpected), what kind of fool needs to have it disclosed to him that a CIO office trading $70 trillion in IR swaps is engaging in risky, speculative trades that could expose JPM to significant losses!?!   This is like suing the Fed because they failed to disclose the fact that Quantitative Easing was debasing your dollars.

Of course an office engaging in unregulated bets totaling 2,000 times the market cap of the entire firm is engaging in risk trading practices!
An investor in NYSE:JPM shares filed a lawsuit in the U.S. District Court for the Southern District of New York over alleged Violations of Federal Securities Laws by certain financial statements made by JPMorgan Chase & Co. in connection with its Chief Investment Office.

According to the complaint the plaintiff alleges on behalf of purchasers of JPMorgan Chase & Co. (NYSE:JPM) common stock during the period between April 13, 2012 and May 11, 2012, that JPMorgan Chase & Co. and certain of its officers and directors violated the Securities Exchange Act of 1934. Defendants issued materially false and misleading statements regarding certain securities trading by the Company’s Chief Investment Office (“CIO”).
Specifically, the plaintiff claims that defendants allegedly misrepresented and/or failed to disclose that the CIO had engaged in extremely risky and speculative trades that exposed JPMorgan to significant losses.

On May 10, 2012 JP Morgan Chase & Co said in a filing with the U.S. Securities and Exchange Commission (”SEC”) that JP Morgan’s Chief Investment Office has had significant market-to-market-losses in its synthetic credit portfolio, and this portfolio has proven to be riskier, more volatile and less effective as an economic hedge than the firm previously believed.” The Company estimated that its Corporate unit could post an $800 million loss in the second quarter.
During a conference call held after the market closed, on May 10, 2012, JP Morgan Chase & Co. CEO revealed that the Company lost about $2 billion on synthetic credit securities after “egregious mistakes” in its Chief Investment Office...

Shares of JPMorgan Chase & Co. (NYSE:JPM) fell from $40.74 per share on Thursday, May 10, 2012 to 35.79 on May 14, 2012, wiping out more than 18billion in market cap.

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Comments

  1. Might be a great time for the CFTC investigation to really upturn the apple cart….

  2. Lovely… A class action suit being filed within a couples days… Dog and pony show by firing or moving people… A supposed investigation…  With the final outcome gonna be money out of the tax payers pockets to pay for there fuck up with them still getting there bonuses and fat pay checks and big ass expense accounts and all kinds of vacations that some how are “business meetings” so they get reimbursed for on top of using them as a tax write off…We can’t have that institution fail… “We need them” to keep the country “financially sound”… My ass!!…Fuckin criminal… People loose fiat dollars in the paper market and are suing cause they lost…  How about you get out of the paper market and let there system implode and collapse!! There suing cause they see dollar signs… No other reason… The fat cats and lawyers will profit while any real working man who may have lost as a result will get a letter stating the proper action has been taken to rectify the mishap, you will find enclosed a check payable at JPM for 1.5% of what we say you lost or $25… Which ever amount is less…
     Mean while MFG people walk away with Corzine sipping sissy drinks in the Caribbean on stolen money… The government poked it’s big juicy nose into that spending our tax dollars just so the weasel could sit there and lie about how he had no idea what happen or where the money is… Cause well he got woken up at 3 in the morning…. I don’t see a class action suit over that yet… And I doubt we will see the “proper” people pay for there rolls in the MFG fiasco…
    Honestly I am already sick of hearing about all of it… They are all liars and not a damn bit of good will come from any of it… I think I will just keep adding to my pile and move along… When I have to return fire in self defense then maybe I will concern myself with these jerk offs… There isn’t enough time in the day to be worrying about the thieves anymore… They aren’t worth the effort..

  3. Yes, may they place the jackhammer where it hurts the most.

  4. I’m with you Danno eventually the money comes out of the tax payers pockets. Why don’t they go after the individuals and take it out of their pockets? If it where me I would be going after the CEO Jamie Dimon as I want to see him squirm and sweat and end up penniless. I Know It’s A Dream. Lol But I Can Dream.

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