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JP Morgan Fined $410 Million in Energy Price Fixing Scandal

  +Follow July 30, 2013 1:11PM
Tickers Mentioned:

JP Morgan Chase & Co. (JPM) ripped off utility providers, and now they’re being forced to pay it back. Following a probe by the U.S. Federal Energy Regulatory Commission that found the company manipulated energy prices in California and the Midwest, the financial giant has agreed to pay over $410 million in fines.

The fine is a small inconvenience for the largest bank in the world, who will pay $285 million back to the US government, $124 million to electric grid operators in California, and $1 million to a Midwest operator. JP Morgan had been accused of artificially driving up prices by engaging in various price fixing schemes to artificially inflate the prices utility customers would pay for electricity.

Despite being one of the only financial powerhouses to never lose money during the 2008 financial crisis, the company has been dogged by allegations of highly unethical business practices that come at the expense of investors. According to the New York Times, eight federal agencies have been investigating the bank in 2013 alone, including the Federal Deposit Insurance Corporation, the Commodity Futures Trading Commission, and the Securities and Exchange Commission.

JP Morgan has been simultaneously lauded and lionized for escaping the investigations with relatively paltry fines and a string of profitable quarters, but a trading loss of $6.2 billion in April 2012, courtesy of the bank’s London branch, showed the first signs that JP Morgan had serious underlying issues.

The loss was singled out by CEO Jamie Dimon as being a result of trades that were “flawed, complex, poorly reviewed, poorly executed, and poorly monitored." The bank has become so large and autonomous that overly risky, complex, and possibly illegal trading methods often fly past upper management, to the point where Dimon wasn’t even aware of what had happened until the company realized such magnanimous losses.

The massive trading losses spurred the passage of the Dodd-Frank Wall Street Reform Protection Act, which has sought to curb impropriety by banks that end up damaging not just investors, but as is the case with the most recent allegations, small businesses and utility customers.

Concerning the current scandal involving unethical trading practices, JPMorgan spokesman Brian Marchiony simply said, “We’re pleased to have this matter behind us.” While that scandal is already written off, the matter of paying off the rest of their regulatory fines is far from over. Dimon has said JP Morgan is likely to shell out over half a billion in settlements in 2013 alone.

This is a drop in the bucket for a $210 billion market cap company, one that still posts record profits. But the bank, infamous for stonewalling regulators, appears to have lost a major battle in the war.   

JP Morgan's stock  is down .40 percent to hit $55.46 a share. They're up 24.30 percent on the year. 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

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Results for jpm
29 Aug 15 01:43:03
STM STMicroelectronics NV Change http://t.co/iAzGMSfLVi $STM $PZA $UWTI $JPM #STM #tradeideas #share
29 Aug 15 01:15:03
JPMorgan awarded $188 million N.J. tax break to move to Jersey City $JPM http://t.co/mbIuUUnaOq
Investors Hangout
29 Aug 15 00:51:14
XLI Industrials Select Sector SPDR Ex-Div Date http://t.co/dC5yFv3G3q $XLI $JPM $ARIA $TGT #XLI #stockmarket #invest
IH News Desk
29 Aug 15 00:48:36
XIU.TO iShares CDN S&P/TSX 60 Index Fund Ask http://t.co/SpZJLXudyc $XIU.TO $CRS $JPM $CVX #XIU.TO #stock #finance
29 Aug 15 00:47:22
XIV VelocityShares Daily Inverse VIX Short Term ETN Stock Message Board http://t.co/j8nZMsEXlh $XIV $JPM $DIS $ITB #XIV #nasdaq #nasdaq
Investors Hangout
29 Aug 15 00:45:04
USO United States Oil Fund, LP Ideas http://t.co/XGCHT2hMsY $USO $CURE $MDY $JPM #USO #invest #finance
29 Aug 15 00:44:15
QLD ProShares Ultra QQQ Fund Dividend http://t.co/ivuRhKXFNW $QLD $XLY $JPM $SMN #QLD #share #stocks
29 Aug 15 00:44:12
TLT iShares Barclays 20+ Year Treasury Bond Fund Chart http://t.co/y9INYskpdN $TLT $BIDU $JPM $FXI #TLT #finance #finance
Investors Hangout
29 Aug 15 00:41:19
JPM J.P. Morgan Chase & Co. Message Board Posts http://t.co/Ah6lgy03Ds $JPM $AC.TO $FB $SGYP #JPM #investing #stocks
29 Aug 15 00:41:17
JPM J.P. Morgan Chase & Co. Ask Size http://t.co/M0NoTCYDvP $JPM $CRGP $SPXS $UVXY #JPM #tradeideas #tradeideas
29 Aug 15 00:41:14
JPM J.P. Morgan Chase & Co. E.P.S. http://t.co/18YIc6Qvlg $JPM $ARIA $CBM $GDXJ #JPM #pennystocks #finance
29 Aug 15 00:41:12
IBM International Business Machines Prev Close http://t.co/gCTzAWNVsb $IBM $AXP $WFC $JPM #IBM #stock #pennystocks
29 Aug 15 00:40:13
JPM J.P. Morgan Chase & Co. Ideas http://t.co/qBc1vSc4ij $JPM $XIU.TO $GOLD $V #JPM #investing #tradeideas
Rosner Stocks
29 Aug 15 00:38:37
GOOGL Google Inc. - Class A Last Trade http://t.co/qAvjZ4AapD $GOOGL $MA $XIU.TO $JPM #GOOGL #tradeideas #finance
Stock Forums
29 Aug 15 00:35:03
CLI Mack-Cali Realty Corp. Stock Forum http://t.co/X64t3zsd9f $CLI $JPM $SCO $YANG #CLI #invest #tradeideas
29 Aug 15 00:34:11
CFX.TO Canfor Pulp Income Fund Day Low http://t.co/tCOSUL4UIv $CFX.TO $UVXY $LULU $JPM #CFX.TO #nasdaq #stocks
Investors Hangout
29 Aug 15 00:33:05
ARP Atlas Resource Partners, LP Open http://t.co/p3mFpHcFiJ $ARP $TQQQ $JPM $UBT #ARP #stockmarket #nasdaq
29 Aug 15 00:32:34
ARIA ARIAD Pharmaceuticals, Inc. Message Board Posts http://t.co/wOLUDPRGFq $ARIA $IEF $JPM $MA #ARIA #finance #stocks
Lucky Jimmy
29 Aug 15 00:32:05
AGQ ProShares Ultra Silver % Change http://t.co/Oewbbixhz7 $AGQ $JPM $FXB $CVI #AGQ #pennystocks #stocks
Stock Forums
29 Aug 15 00:31:18
AAU Almaden Minerals Ltd. 52Wk Low http://t.co/0YmenCbcVr $AAU $ARW $JPM $EWP #AAU #stockmarket #tradeideas
28 Aug 15 23:57:02
Trading indices? check stories for the major constituents of #SP500 $CVX $PG $JPM http://t.co/taR4UCxigp http://t.co/RmurJP0rJt
Dr V
28 Aug 15 23:11:53
RT @jpmorgan: Seen In #Arizona: This stunning shot was taken by a $JPM employee off I-40 in Winslow, AZ near an ancient crater. http://t.co…
28 Aug 15 23:09:01
$JPM Customers Issue And Goldman $GS Takes Another 54,100 Ounces Of Gold For The 'House Account' http://t.co/M0GBs1Yh8M
FinSentS SP500
28 Aug 15 23:06:55
$JPM:US Go-Ahead Group plc Rating Lowered to Neutral at JPMorgan Chase & Co. (GOG) #JPMORGAN CHASE & CO http://t.co/l5tx3QAJHD #SP500
James DiPlata
28 Aug 15 21:24:30
RT @clayton_dd: AAPL Apple, Inc. Last Price http://t.co/uic0BxFG2w $AAPL $JPM $CEW $IDRA #AAPL #share #share
Investors Hangout
28 Aug 15 20:50:49
XLV Health Care Select Sector SPDR Financials http://t.co/XOAKbMUfZb $XLV $CEW $XLV $JPM #XLV #nasdaq #nasdaq
28 Aug 15 20:42:35
JPM J.P. Morgan Chase & Co. P/E Ratio http://t.co/c4sIvuKS7U $JPM $SPXL $GGG $BP #JPM #stockmarket #investing
Stock Wire
28 Aug 15 20:41:16
Man linked to JPMorgan hacking in talks to resolve US case: filing $JPM http://t.co/KMGyTIeDRM
28 Aug 15 20:41:11
IBB Biotech iShares Financials http://t.co/DW0Gl4O6PY $IBB $BWLD $CMCSA $JPM #IBB #nasdaq #invest
28 Aug 15 20:30:33
AAPL Apple, Inc. Last Price http://t.co/uic0BxFG2w $AAPL $JPM $CEW $IDRA #AAPL #share #share
28 Aug 15 19:47:41
WYNN Wynn Resorts Ltd EOD Data http://t.co/h2MPLav2dZ $WYNN $FIT $PYPL $JPM #WYNN #invest #finance
Ophir Gottlieb
28 Aug 15 19:40:00
$C vs. $JPM Head to Head http://t.co/PC53vLQq7L http://t.co/BuLFXe7re4
28 Aug 15 18:50:36
XLK Technology Select Sector SPDR Change http://t.co/xljFh2VNEJ $XLK $HYG $JPM $AA #XLK #tradeideas #share
28 Aug 15 18:47:52
SPXL Direxion Daily S&P 500 Bull 3X Shares Summary http://t.co/Ki1EkoSMKL $SPXL $LUV $JPM $VXX #SPXL #pennystocks #finance
IH News Desk
28 Aug 15 18:47:39
JPM J.P. Morgan Chase & Co. Prev Close http://t.co/Jcui4qlhTV $JPM $UCO $AMBA $NLY #JPM #stock #investKEYS Keysight Technologies Inc.…
28 Aug 15 18:47:17
SH ProShares Short S&P 500 Fund Day High http://t.co/0MDyTbLubR $SH $JPM $AAP $OIH #SH #pennystocks #finance
28 Aug 15 18:47:13
TRN Trinity Industries Inc. Short Sales http://t.co/Wb8u4CShXZ $TRN $TRN $DIA $JPM #TRN #investing #tradeideas
28 Aug 15 18:46:10
RDSH Roadships Holdings, Inc. 52Wk Low http://t.co/EhIT2vD1cU $RDSH $JPM $NAT $EEM #RDSH #pennystocks #pennystocks
28 Aug 15 18:46:08
RPG Guggenheim S&P 500 Pure Growth ETF Financials http://t.co/mkHcUtXRU5 $RPG $GLD $JPM $XLV #RPG #stocks #investing
28 Aug 15 18:46:06
RSP Guggenheim S&P 500 Equal Weight ETF Ask Size http://t.co/lC3P0CjYdG $RSP $XLP $JPM $TD.TO #RSP #finance #stocks
28 Aug 15 18:45:35
LJPC La Jolla Pharmaceutical Co. P/E Ratio http://t.co/cw9vgAC7bB $LJPC $UVXY $JPM $PCLN #LJPC #pennystocks #invest
28 Aug 15 18:45:11
LJPC La Jolla Pharmaceutical Co. P/E Ratio http://t.co/gwjRE3wfOI $LJPC $UVXY $JPM $PCLN #LJPC #pennystocks #invest
28 Aug 15 18:45:10
LJPC La Jolla Pharmaceutical Co. P/E Ratio http://t.co/De8jBcDea1 $LJPC $UVXY $JPM $PCLN #LJPC #pennystocks #invest
28 Aug 15 18:45:10
JPM J.P. Morgan Chase & Co. Prev Close http://t.co/8u8VG8lLY5 $JPM $UCO $AMBA $NLY #JPM #stock #investKEYS Keysight Technologies Inc.…
28 Aug 15 18:45:08
JPM J.P. Morgan Chase & Co. Prev Close http://t.co/4UPqD4EJBZ $JPM $UCO $AMBA $NLY #JPM #stock #investKEYS Keysight Technologies Inc.…
28 Aug 15 18:44:37
JPM J.P. Morgan Chase & Co. Prev Close http://t.co/e3lhO7cgNT $JPM $UCO $AMBA $NLY #JPM #stock #investKEYS Keysight Technologies Inc.…
28 Aug 15 18:44:35
JPM J.P. Morgan Chase & Co. Prev Close http://t.co/6m1zdEmiCt $JPM $UCO $AMBA $NLY #JPM #stock #investKEYS Keysight Technologies Inc.…
28 Aug 15 18:44:35
KSU Kansas City Southern Corp. Company Info http://t.co/kbwHy1HqOS $KSU $JPM $XIU.TO $CACB #KSU #invest #stocks
28 Aug 15 18:44:35
JPM J.P. Morgan Chase & Co. Prev Close http://t.co/r4DqDzPOKS $JPM $UCO $AMBA $NLY #JPM #stock #investKEYS Keysight Technologies Inc.…
Stock Forums
28 Aug 15 18:44:34
MYEC MyECheck, Inc. Last Trade http://t.co/jbwhXnoe5o $MYEC $JPM $NG $TAN #MYEC #investing #invest
  +Follow July 30, 2013 1:11PM



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