The London Whale Never Stood a Chance

The London Whale has spoken. More specifically, Bruno Iksil, the trader behind the wonderfully evocative nickname and the man at the centre of the JPMorgan Chase multibillion-dollar trading loss in 2012 has broken his silence about the whole affair - you can read more here.

In a comprehensive three page letter sent to the media, Mr Iksil sets out his side of the story and in doing so, points squarely to the door of his former employer as the engineers of the whole debacle. The trader writes that he was made a scapegoat for trades that were “initiated, approved, mandated and monitored” by senior management. JPMorgan Chase, have (at time of publication) made no comment, I hasten to add.

Mr Iksil goes on to say that the losses “were not the actions of one person acting in an unauthorised manner [and] for no good reason, I was singled out by the media.” Now, despite the losses, Mr Iksil is it’s assumed a very smart man to have made it to such rarefied heights in one of the biggest banks in the world. He clearly knows far more about banking than I do, but it’s apparent that he doesn’t know much about the media. Let me, pass Mr Iksil’s comments by you again – “for no good reason, I was singled out by the media”. Mr Iksil, you were always going to be singled out thanks to that nickname - the London Whale. It’s a label which, unsurprisingly, the trader resents and apparently borne of the size of the bank’s bets in corporate-debt markets. But that doesn’t matter; the media had their man. Trading is a complicated business, which leaves most audiences cold – you try explaining derivatives and credit-swap indexes over breakfast (or any other meal).

Quite simply, the media thrives on conflict, which results in victims, and with victims come villains. This is not to judge Mr Iksil, but to illustrate the point. The global financial crisis had shown that there was something rotten in the state of banking and to that end, those deemed culpable needed to be held up by the media.

The ‘London Whale’ hints at a corpulent, greedy culture which so resonates with the public when it comes to perceptions of the banking industry – the GFC’s Mr Creosote (see Monty Python), if you will. The name gave the media a face and personality (albeit wrong), which is a damn sight easier to engage with than corporate-bond defaults. So, you see Mr Iksil, singling you out may not have been fair, but it was always going to happen.