2 ex-JPMorgan workers charged in 'London Whale' probe

Two former JPMorgan Chase & Co. employees were charged by federal prosecutors with attempting to conceal trading losses at the largest U.S. bank last year as part of a probe of its $6.2 billion loss on derivatives bets.

Javier Martin-Artajo, who oversaw trading strategy for the synthetic portfolio at the bank's chief investment office in London, and Julien Grout, a trader who worked for him, were charged with conspiracy, wire fraud and false filings in complaints unsealed Wednesday in federal court in Manhattan. The two men engaged in a scheme to falsify securities filings between March and May of 2012, the government said. They face up to 20 years in prison if convicted of the most serious counts.

Jamie Dimon, 57, JPMorgan chief executive, characterized the loss as "the stupidest and most embarrassing situation I have ever been a part of."

First disclosed in May 2012, the bad bets led to an earnings restatement, a U.S. Senate subcommittee hearing and probes by the Securities and Exchange Commission and U.K. Financial Conduct Authority.

U.S. investigators said their probe is continuing, alluding to "pressure from above" the defendants and alleged direction from superiors in court papers and at a news conference Wednesday.

Bruno Iksil, the Frenchman at the center of the case who became known as the "London Whale" because his portfolio was so large, signed a non-prosecution agreement with the United States in June, the government said Wednesday. He pledged to cooperate with investigators as part of the deal.

"This was not a tempest in a teapot but rather a perfect storm of individual misconduct and inadequate internal controls," U.S. Attorney Preet Bharara said Wednesday at a news conference.

Martin-Artajo, 49, and Grout, 35, face four counts: conspiracy to falsify books and records, commit wire fraud and falsify securities filings; falsifying books and records; wire fraud; and making false filings to the SEC.

Joe Evangelisti, a spokesman for the bank, declined to comment on the charges.

JPMorgan stock fell 14 cents to $54.15.