JPM episode helps make case for reform - Geithner

WASHINGTON (Reuters) - The loss of billions of dollars in trading at JPMorgan Chase & Co strengthens the case for reforms of the financial system, U.S. Treasury Secretary Timothy Geithner said on Tuesday.

"I think this failure of risk management is just a very powerful case for ... financial reform," Geithner told an event sponsored by the Peterson Foundation. "The test of reform is not whether you can prevent banks from making mistakes ... the test of reform should be do those mistakes put at risk the broader economy, the financial system or the taxpayer?"

Geithner, who said he had not spoken with JPMorgan CEO Jamie Dimon since the incident, expressed confidence that U.S. financial reforms would "come out as tough and effective as they need to be."

(Reporting by Timothy Ahmann; Editing by James Dalgleish)