On Monday, June 18, 2018, the Commodity Futures Trading Commission (CFTC) slapped J.P Morgan Chase Bank with a fine of $65 million for attempting to manipulate the price of a USD benchmark index.
J.P Morgan Busted for Endeavoring to Influence US Dollar Benchmark
According to the Commodity Futures Trading Commission, the traders of J.P Morgan recurrently tried to manipulate the U.S. Dollar International Swaps and Derivatives Association Fix (USD ISDAFIX), a benchmark interest rate, over a period of five years from 2007 to 2012.
The Commodity Futures Trading Commission found that the traders of J.P Morgan tried to manipulate the US Dollar ISDAFIX interest rate both by releasing false rates knowingly and by “muscling” the index just before its daily reference point snapshot.
James McDonald’s Comment
Commenting on the fine, the director of enforcement at the Commodity Futures Trading Commission – James McDonald, said: “This issue is one in a series of the CFTC actions which clearly demonstrates the unrelenting commitment of the Commission to fish out manipulations from the markets and to protect those that depend on the integrity of critical financial benchmarks.”
J.P Morgan Inaudibly Considers Offering Digital Currencies Products
A lot has been made about allegations that the increase in the value of Bitcoin last year was as a result of market manipulation, but the action of this enforcement functions as a reminder that manipulation exists in almost every financial market and it is committed even by regulated financial institutions.
As reported, Jamie Dimon – the CEO of J.P Morgan, has been a critic of bitcoin, and he called the digital currency a “fraud” that’s “worse than the tulip bubble.” The CEO later retracted his steps comments, but in an ironic way.
The bank was sued for charging clients extravagant fees for buying bitcoin with their credit cards without warning them in advance.
Despite the public statement of Dimon, the bank has been making plans on how to offer digital currency products to customers, starting with Bitcoin futures.