The largest bank in the US, JPMorgan has declared that it is being investigated by the Department of Justice under the accusations of foreign currency controls and trades. JPMorgan has disclosed on Monday that other regulators are pursuing civil investigations, including the U.K Financial Conduct Authority and the Commodity Futures Trading Commission.
The US bank said that it is cooperating with the mentioned regulators and is currently discussing with the DOJ. The bank’s representatives said that it’s not certain whether there will be any settlements after the discussions.
Jamie Dimon, the firm’s CEO estimated that the current legal proceedings might cost JPMorgan more approximately $6 billion.
JPMorgan is not the only financial institution being investigated for abusing the foreign currency market. The financial regulators are investigating whether the bank was trying to manipulate the interest rates with external and internal probes like Deutsche Bank, UBS, the Royal Bank of Scotland, Barclays and others.
JPMorgan has made the disclosure after the US officials have turned up the heat on the financial institutions.
JPMorgan has also disclosed that in the last few months the regulators have been accusing many important banks of fraudulent activities. The US banks added in its filing that these investigations will damage the bank’s reputation and will bring significant collateral consequences to the banks involved. The banks can lose customers or can be restricted from selling certain financial products. The current accusations will not look good for stock prices either.
JPMorgan disclosed how much money the bank has lost since the legal battle began: almost $5.9 billion since September 20. The bank added that it cannot estimate how much it could lose in certain cases.
JPMorgan made an official statement saying that:
“Such actions can have significant collateral consequences for a subject financial institution, including loss of customers and business and the inability to offer certain products or services or operate certain businesses for a period of time.”
The foreign currency market is the largest in the world, with more than $5 trillion each day.