Lew Says Volcker Rule to Prevent Repeat of London Whale Bets
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Treasury Secretary Jacob J. Lew said the Volcker rule banning banks’ proprietary trading that regulators plan to vote on next week will prohibit transactions such as JPMorgan Chase & Co.’s so-called London Whale and put more responsibility on top Wall Street executives.
“The rule prohibits risky trading bets like the ‘London Whale’ that are masked as risk-mitigating hedges,” Lew said in the prepared text of a speech today in Washington. “And it puts in place strong compliance requirements that require those in charge of financial institutions to make sure that the ‘tone at the top’ sends the right signal to the whole firm.”