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Another Day, Another Deal For Chase

The biggest bad boy of the banking industry has agreed to settle another allegation of wrongdoing.

According to media reports, JPMorgan Chase will pay $100 million to the Commodity Futures Trading Commission for fixing derivative prices during the London Whale scandal.

We know that’s a pittance for a bank that’s set aside $23 billion for future legal bills.

But we mentioned the CFTC probe earlier this week when we ran down the half-dozen investigations currently targeting the bank and the $3.68 billion it has paid so far this year to settle other allegations.

The Whale scandal erupted in 2012 when the bank’s London branch lost $6.2 billion from risky derivatives trading.

Losing ungodly amounts of money is not against the law. But Chase traders used what the CFTC called “manipulative devices” to inflate derivative prices and hide their losses. That will get you in trouble.

Chase actually admitted wrongdoing in this case, which is rare, acknowledging that its traders acted recklessly.

The bank has already paid the Security and Exchange Commission $920 million to resolve allegations that its executives knew that those losses weren’t being fully reported to shareholders.

So this settlement brings the legal costs of the London Whale scandal to over $1 billion.

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