Lehman seeks to question JPMorgan's "London Whale"

Thu Feb 14, 2013 8:04pm EST
 
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By Jonathan Stempel

NEW YORK (Reuters) - Lehman Brothers Holdings Inc is seeking court permission to question the JPMorgan Chase & Co trader known as the "London Whale" in connection with its $8.6 billion lawsuit accusing the largest U.S. bank of driving it into bankruptcy.

In a late Wednesday night filing in Manhattan bankruptcy court, Lehman and a committee of its unsecured creditors said months of disclosures about the trader, Bruno Iksil, suggest that he played a "greater role" than previously thought in the events underlying the May 2010 lawsuit.

They asked U.S. Bankruptcy Judge James Peck for permission to ask French authorities to compel Iksil's testimony.

JPMorgan spokesman Joseph Evangelisti declined to comment about the request. A lawyer for Iksil did not immediately return a call seeking comment.

Iksil worked for JPMorgan in London and is no longer employed by the New York-based bank. His activities have been linked to more than $6.2 billion of trading losses at JPMorgan's chief investment office.

In the court filing, Lehman and its creditors committee said Iksil's "practice of intentional mismarking" of trades warranted an inquiry into trades he oversaw that led to an "unjustified multimillion-dollar collateral call" on September 9, 2008, six days before Lehman filed for bankruptcy protection.

Lehman and the committee also want to examine how the chief investment office managed JPMorgan's exposure to Lehman.

But they said Iksil's lawyers have indicated that he will not cooperate in the absence of an official request under international legal norms, even though JPMorgan has largely agreed to the discovery requests.   Continued...

 
Commuters are reflected in stone as they walk past the JP Morgan headquarters in New York, May 17, 2012. REUTERS/Eduardo Munoz