It looks like federal regulators have decided to let a top investment bank executive off lightly after she and her bank manipulated the energy markets so that the states of California and Michigan ended up paying $83 million in “excessive” payments to her employer JPMorgan Chase.
Even as the nation’s top energy regulator is poised to extract a record settlement from JPMorgan Chase over accusations that it manipulated power markets, the agency is expected to spare a top bank lieutenant who federal investigators initially contended made “false and misleading statements under oath,” according to people briefed on the matter.
Blythe Masters, a seminal Wall Street figure who is known for developing exotic financial instruments, emerged this spring at the center of an investigation by the Federal Energy Regulatory Commission into accusations of illegal trading in the California and Michigan electricity markets.
Why is she being let off the hook?
Ms. Masters formed close ties with Jamie Dimon, the bank’s chief executive, who has moved to shore up support for her, according to people close to the bank. The two were bound by their belief that the commodities business was critical to JPMorgan’s growth.
It would never do to prosecute someone who has ‘close ties’ to president Obama’s favorite banker, would it? That would be awkward.