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JP Morgan Fined $410 Million in Energy Price Fixing Scandal

  +Follow July 30, 2013 1:11PM
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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.


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Results for jpm
MasterChartsTrading
30 Jan 15 20:39:38
Watch my video #mkt recap here: http://t.co/sqgPZEvyab I cover the following securities: $SPY $TLT $GLD $GDX $XOM $UUP $MSFT $CVX $GE $JPM
Stockaholics
30 Jan 15 20:10:57
Our Penny Stock Picks Gained an overall 160% This Week! New Picks Coming: http://t.co/LayPQuOeI4 $LVS $JPM $MHYS
Linda
30 Jan 15 20:08:21
RT @JaxBizJournal: $JPM laying off workers in #Jacksonville http://t.co/tdbnOiYDE0
Letty Juarez
30 Jan 15 19:38:30
RT @ben__America: 2011-662 @JBJTimothy: $JPM laying off workers in #Jacksonville http://t.co/Pwh8n70oZj #jaxpol http://t.co/2EIlRTJrle
Florida Retweet
30 Jan 15 18:32:44
RT @ben__America: 2011-662 @JBJTimothy: $JPM laying off workers in #Jacksonville http://t.co/Pwh8n70oZj #jaxpol http://t.co/2EIlRTJrle
Joseph Hogan
30 Jan 15 17:54:12
RT @ben__America: 2011-662 @JBJTimothy: $JPM laying off workers in #Jacksonville http://t.co/Pwh8n70oZj #jaxpol http://t.co/2EIlRTJrle
benAmerica
30 Jan 15 17:30:54
2011-662 @JBJTimothy: $JPM laying off workers in #Jacksonville http://t.co/Pwh8n70oZj #jaxpol http://t.co/2EIlRTJrle
Stock Wire
30 Jan 15 17:28:54
Ashtead Group plc's "Overweight" Rating Reiterated at JPMorgan Chase & Co ... $JPM http://t.co/thbXm9lLvv
Jacksonville Biz
30 Jan 15 16:18:05
$JPM laying off workers in #Jacksonville http://t.co/tdbnOiYDE0
Timothy Gibbons
30 Jan 15 16:18:05
$JPM laying off workers in #Jacksonville http://t.co/EEvanM0n7Z
Carolyn B Miciano
30 Jan 15 15:59:25
Are Options riskier than stocks http://t.co/27y6x4m1CZ $JPM $BA $BAC
Stock Rocket
30 Jan 15 15:52:17
Our Penny Stock Picks Gained an overall 160% This Week! New Picks Coming: http://t.co/vJR8lXzozx $LVS $JPM $MHYS
MasterChartsTrading
30 Jan 15 15:50:20
Long-term chart of $JPM - JP Morgan Chase is looking bearish to me. Live chart here: http://t.co/GE97gS28Fd;
jonas quinn
30 Jan 15 15:11:09
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
Clair Voight
30 Jan 15 15:03:12
$JPM JPMorgan Chase & Co Raises Price Target For Northrop Grumman Following ... http://t.co/7FbjJBVk8Z
John Ablemann
30 Jan 15 15:03:10
$JPM JP Morgan Chase to eliminate 350 jobs http://t.co/0cyZjQ7zFb
alex bello
30 Jan 15 15:01:11
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
Coffeeisforclosers
30 Jan 15 14:54:15
RT @Uldis_Zelmenis: Nikos @ $JPM: Who buys bonds with negative yields? http://t.co/XtLzHI7sDc
ProVesting
30 Jan 15 14:51:16
$MSFT $YHOO $PG $PFE $JPM $BAC $C $DNR $DO $XOM $CAT: U.S. Stocks Follow 2014 Lead With January Retreat: http://t.co/RE8lwedijc
ticxhu
30 Jan 15 14:23:22
RT @Uldis_Zelmenis: Nikos @ $JPM: Who buys bonds with negative yields? http://t.co/XtLzHI7sDc
Uldis Zelmenis
30 Jan 15 14:20:31
Nikos @ $JPM: Who buys bonds with negative yields? http://t.co/XtLzHI7sDc
Stock Wire
30 Jan 15 14:11:11
Petrofac Limited Now Covered by Analysts at JPMorgan Chase & Co. (PFC) $JPM http://t.co/sMHzQCHrzs
Sherilyn Balazs
30 Jan 15 13:59:08
TRADE WELL http://t.co/o6PqlxZaOF $F $GE $T $BAC $VZ $C $AA $JPM $KO $PFE $GOOG $EBAY $FB $TWTR http://t.co/tA4Kb4znmN
Stock Wire
30 Jan 15 13:44:30
Ashland Earns Hold Rating from JPMorgan Chase & Co. (ASH) $JPM http://t.co/TpbMw6opAp
NASDAQ
30 Jan 15 13:33:53
$JPM - Free Writing Prospectus - Filing Under Securities Act Rules 163/433 (fwp) http://t.co/nFZqqjJ34G
$Stocknewsalerts
30 Jan 15 13:31:36
$JPM New SEC Document(s) for JPMorgan Chase & Co. From our Stock News Alerts App
Dearest Leader
30 Jan 15 13:30:27
Wow! $JPM has doubled the security budget??? That can be up to $500M! Who will be the 1st $1B #CISO? http://t.co/5lyPPWWQPv
Breaking News Now
30 Jan 15 13:29:02
$JPM: New SEC Filing for JPM: Form FWP, No. 0001193125-15-027768 http://t.co/4cOn9lPmrT http://t.co/vlXtdBWnET
Shit fund ofthe week
30 Jan 15 13:17:54
With spreads plunging, when will $C $BAC $JPM start announcing layoffs?
Zacks.com
30 Jan 15 12:56:47
Which factors have defined this earnings season? $XOM $JPM $CVX $COP $C $AAPL http://t.co/vfPAnfsrxG
Stock Wire
30 Jan 15 12:54:57
Banco Bradesco SA PT Lowered to $14.00 at JPMorgan Chase & Co. (BBD) $JPM http://t.co/4UCucM6iwB
Tony Ritter
30 Jan 15 12:45:42
@CiovaccoCapital @RedDogT3 @jimiuorio @WallStJesus Banks in a funk. 2015 YTD all down -> $BAC -15% / $C -13% / $JPM - 13% / $PNC - 7.3%
Allen
30 Jan 15 12:45:24
Added $JPM Long
Pharma Watch
30 Jan 15 12:45:04
RT @JNTNews: Just another victim of $JNJ #corruption. Ahh, so #profitable ;o) http://t.co/WLoavZ0lLG #CorpGov #Risperdal #OmniCare @MSNBC @…
Dr. Bozo
30 Jan 15 12:38:23
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
$Stocknewsalerts
30 Jan 15 12:31:40
$JPM New SEC Document(s) for JPMorgan Chase & Co. From our Stock News Alerts App
Mar
30 Jan 15 12:31:30
RT @SeekingAlpha: How Canadian Banking Stocks May Act As A Defensive Play During Rough Periods http://t.co/OWPqdxZMop $BAC $BMO $C $CM $GS …
♫♪ Soul Girl ♪♫
30 Jan 15 12:29:14
sitting watching waiting was right thing with boom $shak a lak ipo & now its sub 47..shame they didnt give us anything ho hum high five $JPM
Cheryl Campbell
30 Jan 15 12:24:11
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
Breaking News
30 Jan 15 12:22:02
$JPM: New SEC Filing for JPM: Form 424B2, No. 0000891092-15-000700 http://t.co/43aCHxxDBu http://t.co/A4lrZxSZ8V
john wright
30 Jan 15 12:20:43
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
Squawk on the Street
30 Jan 15 12:20:36
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
Stock Wire
30 Jan 15 12:16:48
United Microelectronics Corp Upgraded at JPMorgan Chase & Co. (UMC) $JPM http://t.co/1qclj5TxEj
Steve #JMix
30 Jan 15 12:15:34
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
Laurie Kulikowski
30 Jan 15 12:15:33
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
ComfortablySmug
30 Jan 15 12:14:40
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
martingale
30 Jan 15 12:14:02
RT @Kelly_Evans: $SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http:/…
Kelly Evans
30 Jan 15 12:13:30
$SHAK burgers everywhere--except here at the NYSE! No waiting for $JPM's Zerilli, Petno, Dimon & Thelma Ferguson ;) http://t.co/oA5eJtmsa0
ProVesting
30 Jan 15 11:56:02
$FEYE $JPM: Investing in Cybersecurity: http://t.co/7jS47KuSBn
$Stocknewsalerts
30 Jan 15 11:46:27
$JPM New SEC Document(s) for JPMorgan Chase & Co. From our Stock News Alerts App
				
				
  +Follow July 30, 2013 1:11PM
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