It didn't take long for the expected lawsuits against JPMorgan (NYSE:JPM) to emerge in response to the trading loss of $2 billion last quarter, as two lawsuits have already been filed against the giant bank, with more probably to come.
One of the lawsuits accuses the company of securities fraud, based upon “materially false and misleading statements and omissions” allegedly made by CEO Jamie Dimon on the April 13 earnings call.
The complaint states this:
“Defendants misrepresented the losses and risk of loss to the company arising from massive bets on derivative contracts related to credit indexes reflecting interest rates on corporate bonds. These derivative bets went horribly wrong, resulting in billions of dollars in lost capital for the company and billions more in lost market capitalization for JPMorgan shareholders.”
In the other lawsuit top executives Dimon and CFO Douglas Braunstein, along with the board members of the bank being accused of being in breach of fiduciary duty, wasting corporate assets and receiving unjust enrichment.
This appears to be an attempt to take advantage of what appears to be an investing mistake which cost the bank money in order to gain back some of the losses.
An error made in investments isn't a legal matter, in spite of the hype of the Federal Reserve, SEC and FBI investigating the bank.
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