Richard Sharp, a member of the Bank of England's FinancialPolicy Committee (FPC), said the so-called London Whale losses atJPMorgan Chase & Co. illustrate the financial-stability risksposed by firms “too big to manage.”
JPMorgan's report on the losses is “very chilling” in revealinghow information “can get distorted” as it passes through managementlayers, Sharp said in a parliamentary testimony today in London.Money laundering in places such as Mexico at HSBC Holdings Plc androgue trading at UBS AG are among other examples, he said.
“Risks aren't understood where they need to be understood withinthe organization,” Sharp said. “That obviously begs a question howthe regulator can be on top of that if even the organization itselfcan't be on top of that risk?”
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