Red Flags

Warning Signs Ignored at JPMorgan

Risk managers and senior investment bankers reportedly expressed concern over the risky bets being made at JPMorgan Chase in the years leading up to the company’s $2 billion trading loss. Insiders say bosses, including CEO Jamie Dimon, were more concerned with gigantic losses coming from bad mortgages and new regulations threatening the profitability of traditional banking, and this led to a culture of weaker risk management. “There was a lopsided situation, between really risky positions and relatively weaker risk managers,” one former trader told The New York Times. Meanwhile, reports indicate that the bank may be reclaiming bonuses from employees involved in the snafu, including former chief investment officer Ina Drew, who resigned on Monday as a result of the loss.