By now, it would have been hard not to have read about the Justice Department’s landmark criminal indictments against three additional precious metals traders from JPMorgan. Two of the traders charged are current employees and include the head of global metals trading. The charges involve spoofing and market manipulation that extend back for nearly a decade. In a very serious turn, the Justice Department invoked the Racketeering and Corrupt Organization Act (RICO) and referred to the pattern of wrongdoing at JPMorgan as that of a criminal enterprise. I am grateful that the new charges validate virtually everything I have alleged about JPMorgan for more than ten years to the point where a subscriber quipped that the DOJ was plagiarizing my work.
Simply put, the Justice Department leveled the most serious (and deserved) charges against traders of JPMorgan possible, but stopped short of stepping over the critical line of charging the bank itself. This is not a knock on the Justice Department, whose case has been near flawless to this point. As much as I am convinced that JPMorgan has been the prime precious metals manipulator since 2008, indicting the bank for that would likely be a death sentence for JPMorgan with incomprehensible collateral damage to the financial system and society in general.
Another line that the Justice Department went right up to but didn’t cross was in not acknowledging the real crimes that JPMorgan has committed since it acquired Bear Stearns in 2008, and particularly since 2011. Sure, the many instances of spoofing cited – the entry of orders that are immediately cancelled and are solely intended to artificially move prices in a direction beneficial to the spoofer – are devoid of legitimacy and should be cracked down on. And there can be no...