JP Morgan Chase disclosed on 10 May 2012 that it suffered losses of at least USD 2 billion as a result of a failed strategy concerning high-risk investments. This loss grew to EUR 4,4 billion in July. This has led to an investigation by the CFTC into possible criminal conduct at JP Morgan Chase. The Federal Bureau of Investigation (FBI) and the Securities and Exchange Commission ("SEC") have also started investigations into the losses. It is yet unclear if JP Morgan has violated supervisory laws.
The JP Morgan losses are said to further sustain stricter regulation of banks and further reform of the US financial sector. That reform has been initiated in the form of the Dodd-Frank Wall Street Reform and Consumer Protection Act, but the actual practical rules are yet to be implemented. The Dodd-Frank Act provides a framework for supervisors, such as the SEC, to implement rules safeguarding the financial stability in the US.
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