Bruno Iksil, the City trader nicknamed the "London Whale" for the size of the bets he places as well as "Voldemort" after the Harry Potter villain because his trades were so large they moved markets, is also expected to leave the firm, but his departure is not thought to be imminent.

Iksil, who commutes to London every week from his home in Paris, is said to have made about $100m (£62.2m) a year for JP Morgan as one of its best traders in recent years.

Achilles Macris, Iksil's direct boss and the head of the bank's London-based investment office Achilles Macris, is expected to be asked to leave the bank, according to several reports. Javier Martin-Artajo, a managing director on Macris's team, is also expected to leave. They have already been stripped of their ability to trade, according to the Wall Street journal.

The bank is also investigating whether the London traders tried to hide the true extent of the losses, which stem from holdings in insurance against company defaults called credit default swaps (CDS). JP Morgan is also said to be considering closing down the London-based investment unit, which some in the bank believe is too far away from its headquarters in New York.

Expectation of the resignations comes as the bank's boss, Jamie Dimon, admitted over the weekend that he had been "dead wrong" to dismiss concerns about the US bank's trading before reporting the loss, which wiped $14bn off the bank's value.

"We made a terrible, egregious mistake," Dimon said in an interview on NBC's Meet the Press on Sunday. "There's almost no excuse for it."

He said the bank's executives were completely wrong in public statements made in April after being challenged over the size of Iksil's trades in media reports. "We got very defensive. And people started justifying everything we did. We told you something that was completely wrong a mere four weeks ago," Dimon said.

"In hindsight we took far too much risk. The strategy was barely vetted. It was barely monitored. It should never have happened."

On Friday, the US senators Carl Levin and Jeff Merkley said the losses were a "textbook illustration" of why Wall Street needed tougher regulation.

Financial watchdogs have been drawing up the so-called Volcker rule which would limit trades similar to those that went wrong at JP Morgan.

The rule forms part of the Dodd-Frank Act brought in after the credit crisis. Dimon has campaigned against the Volcker rule and other sections of the act. Levin and Merkley said Wall Street had successfully managed to weaken the rule.

Levin told Meet the Press that Wall Street had undertaken massive lobbying to create a huge loophole in the Volcker rule.

The rule would limit the bets that banks can make with their own funds – which is known as proprietary trading. They would only be allowed to hedge against risky bets on an individual basis. The loophole currently under consideration would permit hedging against a portfolio of investments. "We have got to be very, very careful that the regulators here are not undermined by this huge effort to weaken the rule by putting in a huge loophole," said Levin.

"The issue here is the power of the banks and whether or not we are going to put a cop back on Wall Street," he said. "The issue is whether we are going to stick with the law as written which will prevent us from bailing out banks again."

SOUCE: The Guardian