CONSEQUENCES FOR POTENTIAL CONDUCT SHORTCOMINGS

The IBT reports that the Head of US Treasury trading and a colleague at JP Morgan & Co has left the firm for potential conduct failures.  The failure has been described as being relating to follow compliance processes of the firm.  As a result, the trading head has been asked to resign. According to the IBT report, the two traders circumvented compliance rules by converting Treasuries to STRIPs, the IO component of a UST book, possibly as a means to mitigate risk reporting and thus market risk capital requirements associated with a more substantial book. The trader was an experienced Desk Head with a 15years or more career at ML, HSBC and then JPM. He was named by Crain's some 12 years ago as part of the 40 under 40 names to watch on the Street. Anyone looking for evidence that firms now will act swiftly to address negative conduct failings need to look no further, though conduct success stories would be good to see as well.  See this link for more information: http://www.ibtimes.com/two-jpmorgan-traders-fired-compliance-failures-ft-2326583