There are no problems at the SEC. Really. None at all. Nope. Everything is hunky dory.

[PA Democrat]

10. Unregulated capitalism is like a flesh-eating bacteria which will destroy

its host if left unchecked.

Dimon signed off on JPMorgan's financial statements which included a change to the VAR (value at risk) model that appears to have been made in an attempt to deceive shareholders about the risky positions the bank held in its portfolio. Sarbanes-Oxley requires the CEO to be held accountable for the accuracy of their company's financial reports. Dimon appears to have been in violation of that legal requirement.

The head of the U.S. Securities and Exchange Commission told lawmakers on Tuesday that her agency is probing JPMorgan Chase and Co's financial reporting and emphasized that big banks are required to publicly disclose changes to the models they use to measure risk.

SEC Chairman Mary Schapiro assured the Senate Banking Committee that the SEC is investigating JPMorgan's revelation earlier this month that it suffered at least $2 billion in losses on complex trades that started as hedges but morphed into a risky bet.

<snip>
She also addressed reports that JPMorgan changed its value-at-risk (VaR) model, an estimate of losses that could occur on a particular trade or portfolio of trades, in a way that allowed the trading portfolio in question to appear safer than it actually was and gave traders more leeway to make risky bets.

"When there are changes to the VaR model - as newspapers have reported was done at JPMorgan; they changed their VaR model - those changes have to be disclosed," Schapiro said.

http://www.reuters.com/article/2012/05/22/jpmorgan-hearing-idUSL1E8GM5ZM20120522