2012 JPMorgan Chase trading loss

In April and May 2012, large trading losses occurred at JPMorgan's Chief Investment Office, based on transactions booked through its London branch. The unit was run by Chief Investment Officer Ina Drew, who later stepped down. A series of derivative transactions involving credit default swaps (CDS) were entered, reportedly as part of the bank's "hedging" strategy. Trader Bruno Iksil, nicknamed the London Whale, accumulated outsized CDS positions in the market. An estimated trading loss of US$2 billion was announced. However, the loss amounted to more than US$6 billion for JPMorgan Chase.

These events gave rise to a number of investigations to examine the firm's risk management systems and internal controls. As a consequence, JPMorgan Chase agreed to pay a total of US$920 million in fines to US and UK authorities (including £137.6 million to UK). JPMorgan Chase cut chief executive Jamie Dimon's 2012 pay in half, from US$23 million to $11.5 million, as a consequence for the $6 billion trading loss.