Somewhat ironically, the "punishment" of Goldman and JPMorgan has boiled down to the punishment, or lack thereof, of two Frenchmen. On one hand, we have Fabrice Tourre, who we are led to believe (laughably so) was solely-responsible for all CDO-related transgressions at Goldman in the 2003-2007 period. On the other, we have the London Whale, former JPMorgan employee and also French citizen, Bruno Iksil who was the catalyst and public face, that led to the unwind of the biggest prop trading desk in history. But while Fabulous Fab was scapegoated to the full extend of the crony law, Bruno is set to walk. The reason: the London Whale has become the London Snitch.
Bloomberg reports [5]:
Bruno Iksil, the former JPMorgan Chase & Co. (JPM) trader whose bets caused more than $6.2 billion in losses last year, is now central to any U.S. 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 U.S. 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.
The details of the case against the London Whale(s) is by now well known and fully documented here [6]. What is also known is the everyone in the London CIO office was responsible for the massive multi-billion loss, and the blame stretches all the way to Jamie Dimon for i) lack of supervision, ii) being completely unaware of what was going on in his firm, or worst iii) lying about what he knew, when he knew it, because for Jamie to be unaware for months about the "tempest in a teapot" is something very few believe.
The only question remaining is who will be the main snitch. For now, that honor falls to the Frenchman. However, if and when he throws his former co-workers under the bus, one wonders whom Martin-Artajo will snitch out, and/or if the chain keeps moving up, will Ina Drew say a few bad words under oath about Jamie Dimon, who may or may not have perjured himself as well. After all, there is no honor among Wall Streeters.
Then again, in the United Banana Republic States, where the president appoints as head of the NSA-commission the same person who lied under oath to Congress about the NSA, we can imagine even if Jamie were to be ultimately thrown under the bus, he would at worst get another set of presidential cufflinks, most likely with a presidential commendation.