JPMorgan Chase won a judge's preliminary approval of a deal to pay $150 million to settle investor claims that it hid from them as much as $6.2 billion in losses caused by a trader dubbed the London Whale.
U.S. District Judge George Daniels in New York on Tuesday issued a ruling tentatively accepting the accord. After hearing from investors covered by the settlement, the judge will decide later whether to grant final approval.
"The settlement is fair, reasonable and adequate for this class," Daniels said.
A group of pension funds accused JPMorgan of turning its chief investment office in London into a "secret hedge fund" that caused the losses. The bank told investors that the office's primary role was managing risk when in fact it was engaging in trades to generate profit, they said.
Ohio pension funds and other plaintiffs in the case claim they incurred tens of millions of dollars of losses because their fund managers were given "false and misleading information." Bruno Iksil, who amassed positions in credit derivatives so big and market-moving he became known as the London Whale, made the trades for the bank.