Background checks, anyone?
Irvin Goldman, the JPMorgan Chase risk chief who oversaw the unit that suffered a $2 billion trading loss in credit derivatives, was fired by Cantor Fitzgerald in 2007 for hemorrhaging losses that prompted regulatory action, according to Bloomberg.
Goldman had only been at his job at JPMorgan since February. Yet according to Bloomberg’s source, the company’s chief risk officer, John Hogan, (who himself only became chief risk officer of JP Morgan in January) was unaware of Goldman’s firing from Cantor when he named him the unit’s head of risk - although others at JP Morgan knew about Goldman’s history at Cantor, a person briefed on the situation told the news service.
Cantor was fined $250,000 by the enforcement arm of NYSE Arca in 2010 for failing to monitor Goldman’s personal bets. He had been buying and selling the same stocks in personal accounts that he traded in a proprietary account at the New York-based brokerage and the regulator found that there was a conflict of interest, Bloomberg reports.
Cantor settled the case without admitting or denying wrongdoing.
Goldman has now been relieved of his duties at JP Morgan although he remains at the bank in an advisory role to Matt Zames, who has just replaced Ina Drew as chief investment officer.
Goldman himself has been replaced in his day-to-day duties by Chetan Bhargiri, a former managing director of market risk at the investment bank, who now reports to Hogan.