WASHINGTON — Soon after lawmakers finished work on the nation’s new financial regulatory law, a team of JPMorgan Chase lobbyists descended on Washington. Their goal was to obtain special breaks that would allow banks to make big bets in their portfolios, including some of the types of trading that led to the $2 billion loss now rocking the bank.
Even after the official draft of the Volcker Rule regulations was released last October, JPMorgan and other banks continued their full-court press to avoid limits.
That was not the intent of the law, said Phil Angelides, who headed the Financial Crisis Inquiry Commission. “I think the regulators need to go back and sharpen their pencils,” Mr. Angelides said. “The intent of the law was to stop insured depositories from doing propriety trading with this kind of risk profile.” And whatever JPMorgan calls it, “it sure looks like proprietary trading, which Dodd-Frank was designed to stop insured depositories from engaging in.”
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