Spain rejects U.S. extradition of 'London Whale' supervisor

By Sonya Dowsett MADRID (Reuters) - Spain on Thursday rejected a U.S. extradition request for Javier Martin-Artajo, an ex-JP Morgan Chase & Co executive indicted over the "London Whale" scandal which led to over $6 billion (4 billion pounds) in trading losses in 2012. The case is the latest to show the complexity of transatlantic financial inquiries after a British trader accused of contributing to the 2010 Wall Street "flash crash" began a fight against extradition to the United States on Wednesday. The Spanish High Court said it would not send Martin-Artajo to the United States for judgement because the alleged crimes had not taken place in that country. However, the United States could pursue action against Martin-Artajo in Spain, it said. Extraditions from Spain to the United States are rare and Madrid has tended to shun requests to send its citizens to be tried there. Martin-Artajo was the supervisor of Bruno Iksil, nicknamed the London Whale for his big derivative bets. The Spaniard is accused of trying to minimise potential trading losses held on his group's books at the bank's London operations. The mismarking allegedly took place as the traders tried to hide mounting losses in an illiquid derivatives market, where they had made outsized bets. Martin-Artajo, arrested in Madrid in 2013 and granted a conditional release, told the Spanish High Court in March that he was innocent. He opposes being extradited because the events happened in Britain, not the United States, and because he is a Spaniard. He faces charges of wire fraud and conspiracy to defraud which could carry decades-long prison sentences in the United States. He is the most senior figure detained over the case, while Iksil, who cooperated with U.S. authorities, avoided criminal charges. JPMorgan Chief Executive Jamie Dimon initially dismissed the London Whale scandal as a 'tempest in a teapot'. The bank was fined more than $1 billion by U.S. and British regulators for the loss and the scandal stoked concerns in the U.S. Congress over Fed regulation. (Additional reporting by Paul Day; Editing by Ruth Pitchford)