London whale Bruno Iksil resurfaces in New York

Bruno Iksil, the former JPMorgan Chase trader whose bets caused more than $6.2 billion in losses last year, is now central to any US charges against his former colleagues. Iksil, the Frenchman who became known as the London Whale because of his trading book’s size, has been cooperating with the Federal Bureau of Investigation and the Manhattan US Attorney’s Office for months in their probe of the New York-based bank’s biggest trading debacle ever, said three people with direct knowledge with the matter. Iksil won’t face charges as long as he cooperates and testifies, the people said.


Prosecutors may announce charges as early as this week against former London-based JPMorgan employees, accusing them of trying to mask losses on a complex derivatives portfolio, said another person who asked not to be named because the investigation isn’t public. The episode has already prompted JPMorgan’s board to cut CEO Jamie Dimon’s pay in half.

“Jamie Dimon really wants to put this issue behind the bank,” said Christopher Wheeler, an analyst at Mediobanca in London who has an outperform rating on JPMorgan’s stock. Charges against former employees would mean “JPMorgan will have to put up with having its dirty linen washed in public”.

It still isn’t clear who may be charged, the person said. Javier Martin-Artajo, a former executive who supervised Iksil’s trading strategy, and Julien Grout, a trader who helped mark Iksil’s book, are likely to be charged, the New York Times had reported. Prosecutors also are weighing penalties for the bank, including a fine and reprimand, the newspaper said in a subsequent report.

Police showed up at Grout’s home in London last week and his landlord gave them a forwarding address in the south of France, said a source. A French citizen, Grout may be difficult to arrest if he’s charged because France has tougher extradition laws than the UK, the person said. Martin-Artajo, a Spaniard, is away with his family, according to his next-door neighbour in Chipping Norton, England.