In the years since the financial crisis, we may not have solved too big to fail, sent any bankers to jail, or done much to prevent another financial crisis, and we certainly haven't changed Wall Street's devotion to money-making at all costs.
But we at least have finally gotten a bank to admit it broke the law.
In what amounts to a relatively stirring triumph of justice on Wall Street, the Securities and Exchange Commission has convinced JPMorgan Chase, the biggest U.S. bank by assets, to admit that it broke federal securities laws in its handling of the $6.2 billion "London Whale" trading debacle.
"JPMorgan failed to keep watch over its traders as they overvalued a very complex portfolio to hide massive losses," George Canellos, co-director of the SEC’s enforcement division, said in a press release announcing the bank's settlement with the SEC. "While grappling with how to fix its internal control breakdowns, JPMorgan's senior management broke a cardinal rule of corporate governance and deprived its board of critical information it needed to fully assess the company's problems and determine whether accurate and reliable information was being disclosed to investors and regulators."
"We have accepted responsibility and acknowledged our mistakes from the start, and we have learned from them and worked to fix them," Jamie Dimon said in a separate statement.
Which is true, depending on what Dimon means by "from the start." When the London Whale story first broke in the spring of 2012, Dimon infamously dismissed it as a "tempest in a teapot." He has since repeatedly admitted that the bank erred, although this is the first time it has admitted breaking laws.
JPMorgan also agreed to pay $920 million to the SEC and other agencies to settle various London Whale charges. That is quite a lot of money to you and me, more than twice the size of the current Powerball jackpot.
But it amounts to just 14 percent of the bank's quarterly profit of $6.5 billion.
To put it another way, these fines amount to less than 13 days' profit for the bank, or about three days and eight hours' worth of revenue. So the money is really just a slap on the wrist. It's the admission of wrongdoing that matters.
Does that admission have any practical impact? Maybe. It could open the bank up to being sued. More than it already is, I mean. It may not help the bank with the Justice Department and the Commodity Futures Trading Commission, which still have their own criminal and civil probes going. Then again, the bank's cooperation could win it favor at those agencies, too.
But at least this settlement does seem to end an annoying practice of recent years, of letting banks and bankers walk free with fines while pretending they did nothing wrong.
In one of the most glaring examples, Goldman Sachs paid $500 million to settle charges of misleading investors with mortgage-backed securities ahead of the crisis. It admitted doing no wrong in that settlement. And yet a few years later, one mid-level trader, Fabrice Tourre, was found liable for fraud in the very same set of circumstances.
That's just unfair. It weakens the government's credibility and sends the signal that, if you are big enough, the laws don't apply to you.
Thursday's settlement takes a different approach, making good on a promise by new SEC Chairman Mary Jo White. Credit to her for picking a very big target to use as an example. It may not be very much, but it is something.
Let's just hope it's not the best we're going to get from regulators.