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Former SEC chairman Harvey Pitt on what rules and regulations J.P. Morgan might face in wake of its recent trading loss.
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Peter burns alright thanks so much.
Well let's continue at this CEO Jamie dying saying he did not know if JPMorgan had broken any laws or regulatory rules.
And -- the bank was totally open to regulators our next guest is very familiar with what kind.
Rules and regulations might apply here Harvey Pitt former SEC chairman he's in Washington for us this afternoon.
Thank you for being here mr.
-- how do you see this unfolding from here for JPMorgan.
Well I think JPMorgan is gonna have its hands full both with the SEC inquiries congressional.
Inquiries.
And the constant flow world news prints and so I think people are going to use this circumstance.
Of their own agendas.
-- So is a former head of the SEC I mean you know exactly what they're going to be looking for when they go in there what is that what they're looking for.
Well no one knows exactly what bill.
Look -- but I I would suspect that there are a couple of things first -- of ball is -- -- of these losses occurred.
When was it known.
In terms of the dimensions.
Was the board informed.
And YE.
Was disclosure.
Not made any earlier that's not to suggest it should have been it's only does suggest that.
A critical question will be where investors.
And the public informed of this at the earliest practical moment.
What what would your four CM some potential violations around a trade what is a possibility that they would be looking for.
Well there the trade itself.
Wouldn't violate.
In my view any rules unless.
It involves.
A breach of internal.
Systems of control.
Banks are not.
Allowed to take.
Excessive risk safety and soundness becomes very important.
And one of the issues will be when anyone loses two billion dollars is how did that happen.
And was it consistent -- all of the internal requirements as well as fed rules and SEC requirements.
Do you think that JPMorgan in the ends will be broken not.
No I think that's premature ending.
Although this is clearly a block -- JPMorgan.
Has -- the capital on hand and this did not pose any threat to of the bank's solvency.
Or -- continued operation.
What I -- Jamie Dimon himself do you think he'll step down our will his impact and influence eat well not a significant from here on out -- -- he recoup that.
Well I think he -- he.
My bet we'll be he would not step down what happened here is very unfortunate and there are questions whether certain public statements that were made earlier.
Before the actual disclosure might have violated securities laws.
But in my view the real question is the board of directors has to understand how this came to pass.
And what assurances there are that it won't happen again.
The fact that the bank would lose two billion and no one in the senior management or the board.
Being aware of it.
There's got to be -- a matter of great concern.
Harvey -- many thanks for your time in your insights on this topic appreciate it.
My pleasure.
