JPMorgan Chase will pay a $250 million fine for purported poor risk management practices and alleged conflicts of interest
According to the Office of the Comptroller of Currency (OCC) this week, JPMorgan Chase will pay a $250 million fine for purported poor risk management practices and alleged conflicts of interest in its advisory business.
The company stated earlier this month that it might have to pay a penalty for “shortcomings in internal controls and internal audit tied to certain advisory and other activities,” according to Financial Planning.
Apparently the OCC found the bank’s risk management practices were “deficient and it lacked a sufficient framework to avoid conflicts of interest,” according to the OCC’s news release. JPMorgan reportedly did not admit guilt in the matter.
In September the company reportedly agreed to pay Commodity Futures Trading Commission and other agencies $920 million for manipulating the markets for precious metals and Treasury securities.
The OCC reportedly found that for several years JPMorgan had a weak management and control program going back several years and had an “insufficient” auditing program to catch any problems.
When banks direct investors to their own brokers or funds, conflicts of interest can occur, according to the OCC. JPMorgan has reportedly fixed the deficiencies that led to the fine, the order said.
According to Financial Planning, Banks are reportedly rushing to settle federal investigations before President-elect Joe Biden takes office because he is expected to put a tougher regulatory framework in place.
The penalty will reportedly be paid to the U.S. Treasury, according to the OCC.
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