Office of the Comptroller of the Currency Accuses Bank of Inadequate Internal Controls
JPMorgan Chase Bank has been ordered to pay a $250M penalty. The Office of the Comptroller of the Currency (OCC) contends that the bank engaged in “unsafe and unsound practices” related to its internal controls and an internal audit of fiduciary duties.
With fiduciary assets of $29.1 trillion, JPMorgan has one of the biggest and complex fiduciary businesses. It offers many types of investment strategies via different investment vehicles to its clients. The Bank is not denying or admitting to the agency’s findings.
According to the OCC, JPMorgan’s management and control framework for fiduciary activities was “weak,” and included internal controls that were “inadequate” and an audit program that was “insufficient.” The OCC also found that JPMorgan’s risk management practices were “deficient” and its framework for avoiding conflicts of interest was also deemed “insufficient.”
The $250M penalty will be paid to the US Treasury Department. The OCC said that JPMorgan has since fixed the deficiencies that resulted in the civil action. Affirming this, the Bank issued a statement noting that it invested in improvements to its controls platform to address the issues noted.
Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) has pursued claims against JPMorgan Chase on behalf of investors in the past. We help our clients recover the losses they’ve sustained due to the negligence of their brokers, private bankers, and investment advisors. Contact us online to discuss your case.
JPMorgan Settles Spoofing Charges for $920M
In September, JPMorgan and its subsidiaries J.P. Morgan Securities LLC (JPMS) and JPMorgan Chase Bank, N.A. (JPMC) reached a $920M settlement with multiple government agencies. Its settlement with the US Justice Department is a deferred prosecution deal over two separate frauds.
One allegedly involved thousands of incidents of unlawful trading involving precious and futures contracts. The other also was related to thousands of incidents of allegedly unlawful trading involving US futures contracts and the secondary market for US Treasury bonds and notes.
JPMorgan will pay fines of $436.4M, restitution of $317M, and disgorgement of over $172M to the Commodities Futures Trading Commission (CFTC) for the allegedly manipulative trading practices, also known as spoofing. It will pay the US Securities and Exchange Commission (SEC) $35M.
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