The Federal Reserve Board and the Office of the Comptroller of the Currency both issued cease and desist orders against the US moneycentre bank after finding deficiencies in the audit and finance functions both within and beyond its chief investment office (CIO) and in its anti-money laundering procedures.

The sanctions follow the disclosure of significant losses in a large synthetic credit portfolio that was managed by the CIO. The botched bet - made by UK big fish Bruno Iksil - had managed to wipe out $51 billion in shareholder value before alarm bells started to ring at the bank's head office in New York.

Among other things, the Fed identified deficiencies in risk management oversight, modelling assumptions, audit and finance reporting and escalation to senior management.

The OCC further found that the bank's BSA (bank Secrecy Act) compliance programme had "critical deficiencies" with respect to suspicious activity reporting, monitoring transactions, conducting customer due diligence and risk assessment, and implementing adequate systems of internal controls and independent testing.

Despite the criticism, JPMorgan Chase escaped with nothing more than a wrap on the knuckles. No fines were levied by the watchdogs and the bank didn't admit or deny wrongdoing in consenting to the regulatory orders.

The reputational damage to the bank and its chief Jamie Dimon is substantial, however, with more to come upon completion of ongoing investigations by the Securities and Exchange Commission, the FBI and the UK's Financial Services Authority.