The SEC has entered the JPMorgan $2 billion trading loss fray - perhaps joining forces with the Federal Reserve and the U.K.'s Financial Securities Authority, who earlier announced their joint investigation into activities leading up to the $2 billion loss by JPM's investment unit. Frankly, it was surprising that the SEC was not identified as an original member of the investigation from the outset - this is, after all, the Commission's area of expertise.  Anyway, we don't any of the "whys or wherefores." In any case, the SEC is investigating for potential civil violations surrounding the $2 billion loss that JPMorgan Chase disclosed on Thursday.  The SEC involvement is in a preliminary stage and is unofficial, in that the Commission has not announced that it is looking into JPMorgan's accounting practices and public disclosures about the trades.  Regulators first learned about the trade activities in April, and formally opened an investigation in recent days. New York Inquiry. The inquiry, which is being run out of New York, will probably examine the bank’s past regulatory filings about the internal unit that placed the trades, as well as recent statements from the firm’s top executives.  In April, questions surfaced about the group, called the chief investment office, after reports emerged that a London-based trader was taking large bets that distorted the market. At the time, CEO Jamie Dimon publicly dismissed the concerns about the trading activities, calling them a "complete tempest in a teapot."  On Thursday, 5/10, JPMorgan revealed that the losses were more significant that first indicated, and the cost could rise to $2 billion or more.  In his statement, Mr. Dimon attributed the losses to "egregious mistakes." What the SEC Is Looking At. One important avenue reportedly is the firm’s accounting methods relating to the trades.  Investigators could take a close look at a measure known as "value-at-risk." The company disclosed earlier this year that it changed the way it calculates the metric, which may have masked some of the risk surrounding this trade.  On a conference call Thursday, Mr. Dimon said the firm had reverted to the old way of measuring value-at-risk. It should be noted that, at this point in time, no one at JPMorgan has been accused of any wrongdoing. Potential Impact on Volcker Rule. It will be interesting to see what, if any impact the incident may have on the finishing touches of the industry's new regulations.  Banks, including JPMorgan, have been pushing back on some of the rules, saying they will hurt the markets and the broader economy.  But JPMorgan’s disclosure on Thursday could provide bank reformers with additional fodder. "The enormous loss JPMorgan announced today is just the latest evidence that what banks call ‘hedges’ are often risky bets that so-called ‘too big to fail’ banks have no business making," Senator Carl Levin, a Michigan Democrat, said in a statement on Thursday. United States and British regulators have been taking a look at the JPMorgan unit for nearly a month, after media reports shined a spotlight on the trading group. The bank started talking with the Federal Reserve and Britain’s Financial Services Authority about the chief investment office in April, according to people with direct knowledge of the matter.  The SEC became aware of the group’s activities around the same time. For further details, go to:  [Dealbook, 5/11/12].