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JPMorgan fallout continues as regulators, Senators seek action

Senators and regulators recently met to discuss the investing losses at JPMorg

The intense scrutiny of JPMorgan Chase heated up recently following an announcement from the Securities and Exchange Commission that it would launch an investigation into the firm's financial reporting and disclosure practices.

In a meeting with the Senate Banking Committee, SEC Chairwoman Mary Shapiro spoke of the need to investigate JPMorgan's financial accounting, Bloomberg News reported. The company lost more than $2 billion in risky trading recently, prompting outcries from consumers, investors, regulators and lawmakers alike. According to Shapiro, her agency will look closely at the company's financial reports, as well as allegations it changed its value-at-risk ratio without properly reporting it.

"When there are changes to the VaR model - as newspapers have reported was done at JPMorgan; they changed their VaR model - those changes have to be disclosed," Schapiro said.

Reuters, meanwhile, reported on the banking committee's response to the JPMorgan losses. Senators and other regulators saw the event as a perfect illustration of the necessity of the Dodd-Frank Act, which contains provisions to separate consumer deposits and risky investments within the same institution.