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United States Senate

PERMANENT SUBCOMMITTEE ON INVESTIGATIONS

Committee on Homeland Security and Governmental Affairs

Carl Levin, Chairman

John McCain, Ranking Minority Member

JPMORGAN CHASE WHALE TRADES:

A CASE HISTORY OF DERIVATIVES

RISKS AND ABUSES

MAJORITY AND MINORITY

STAFF REPORT

PERMANENT SUBCOMMITTEE

ON INVESTIGATIONS

UNITED STATES SENATE

RELEASED IN CONJUNCTION WITH THE

PERMANENT SUBCOMMITTEE ON INVESTIGATIONS

MARCH 15, 2013 HEARING

SENATOR CARL LEVIN

Chairman

SENATOR JOHN McCAIN

Ranking Minority Member

PERMANENT SUBCOMMITTEE ON INVESTIGATIONS

ELISE J. BEAN

Staff Director and Chief Counsel

ALLISON F. MURPHY

Counsel

ZACHARY I. SCHRAM

Senior Counsel

ELIZABETH V. BALTZAN

Former Congressional Fellow

ERIC S. WALKER

Former Detailee

HENRY J. KERNER

Staff Director and Chief Counsel to the Minority

BRAD M. PATOUT

Senior Policy Advisor to the Minority

STEPHANIE HALL

Counsel to the Minority

SCOTT D. WITTMANN

Research Assistant to the Minority

FERAS SLEIMAN

Law Clerk

TODD PHILLIPS

Law Clerk

ADAM HENDERSON

Professional Staff Member

MARY D. ROBERTSON

Chief Clerk

4/11/13

Permanent Subcommittee on Investigations

199 Russell Senate Office Building – W ashington, D.C. 20510

Majority: 202/224-9505 – Minority: 202/224-3721

W eb Address: http://www.hsgac.senate.gov/subcommittees/investigations

JPMORGAN CHASE WHALE TRADES:

A CASE HISTORY OF DERIVATIVES RISKS AND ABUSES

TABLE OF CONTENTS

I.

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

A. Subcommittee Investigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

B. Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(1) Increasing Risk. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2) Hiding...