Jamie Dimon Gets Pay Cut But Escapes 'Whale' Blame

In a media conference call, Dimon said he respected the board's decision. "They had a tough job. They had to see the positives, which were large and there was this huge, embarrassing mistake."

Among the task force main observations: The CIO management established "competing and inconsistent priorities" for the synthetic credit portfolio. Two, trading strategies to achieve the various priorities were poorly conceived and not fully understood by the CIO management.

Three, the CIO management failed to obtain robust, detailed reporting on the activity in the portfolio.

CIO personnel at all levels "failed to adequately respond to and escalate (including to senior Firm management and the Board) concerns" that were raised at various points during the trading."

Certain traders "did not show the full extent of the Synthetic Credit Portfolio's Losses" and CIO provided "excessively optimistic and inadequately analyzed estimates of the Synthetic Credit Portfolio's future performance" to the senior management in the days leading up to the earnings call on April 13, when Dimon and Braunstein dismissed reports of the London trades as a "tempest in a teapot."

The task force cited remedial steps, many of which have already been taken by the company including replacing individuals responsible for the loss.

Dimon told reporters during the media call that the losses at the CIO were close to being a "non-issue" for the bank. JPMorgan suffered a modest loss from the synthetic credit positions in the fourth quarter but Dimon does not expect the losses to be material to the public anymore in the future.

Still, JPMorgan is under investigation from regulators regarding the CIO loss.

Earlier this week, the Federal Reserve and the OCC ordered the bank to enhance its risk management system after an investigation into the trading losses found deficiencies in the bank's risk controls.

No monetary penalty was imposed but the regulators did not rule out penalties in the future. The U.K.'s Financial Services Authority and the U.S. Senate Permanent Sub Committee are also conducting separate investigations.

JPMorgan meanwhile reported record profits for 2012. Read more on that here.

--Written by Shanthi Bharatwaj in New York



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