U.S. federal prosecutors and securities regulators on Wednesday criminally charged two former traders at JPMorgan Chase & Co (NYSE:JPM) with conspiring to falsify books and records and committing wire fraud, as part of a probe into the bank’s losses, approximately $6.2 billion in 2012 on derivative bets.

The SEC said Javier Martin-Artajo, a former managing director and trading supervisor at the bank, and Julien Grout, another former trader at the bank, were charged with allegedly attempting to hide massive trading losses by fraudulently overvaluing investments in a portfolio they were managing, which caused the bank’s first quarter income in 2012 to be overstated by $660 million.

“The trading instruments were complex, but these traders had a simple rule to follow: Tell the truth about their fair value,” George S. Canellos, co-director of the Securities and Exchange Commission’s Division of Enforcement, said in a statement. “Yet these traders brazenly accumulated a massive position in derivatives with lax oversight, and then lied to cover up their massive losses when the market turned against them.”

The SEC said Martin-Artajo and Grout worked in the bank’s chief investment office, or CIO, which created the hedge portfolio known as Synthetic Credit Portfolio, or SCP.

Martin-Artajo and Grout began concealing the losses incurred by SCP’s positions in March 2012, the SEC said, adding that Grout, acting as directed by Martin-Artajo, sent daily reports to the CIO management understating SCP’s losses. 

By the end of April 2012, the difference between prices assigned to the portfolio’s positions by the two traders and the mid-market prices previously used to value SCP’s positions had grown by more than half a billion dollars, which prompted JPMorgan’s management to suspend the traders’ marking authority, SEC said.

In April 2013, JPMorgan’s Chairman and CEO, James Dimon, had reiterated his apology over the fiasco, dubbed the “London Whale” trading losses, characterizing it as a “real kick in the teeth” and “the stupidest and most embarrassing situation I have ever been a part of.”

“I feel terrible we let our regulators down” Dimon said. He vowed to make the bank’s compliance with regulatory obligations a priority, according to news reports.

Prosecutors expressed hope that Martin-Artajo, who lives in London, and Grout, who lives in France, would voluntarily return to be formally arraigned, rather than face extradition, news reports said.

Norton Rose Fulbright, the London-based law firm representing Martin-Artajo, said: “Martin-Artajo is confident that when a complete and fair reconstruction of these complex events is completed, he will be cleared of any wrongdoing,” the  BBC reported.