JPMorgan Chase Unit to Pay $250 million Penalty Over Poor Internal Controls -- Update
November 24 2020 - 4:34PM
Dow Jones News
By Jack Hagel and Josh Beckerman
A top banking regulator fined a JPMorgan Chase & Co. unit
$250 million over deficiencies in internal controls and internal
audit practices.
JPMorgan Chase Bank N.A. entered into a resolution with the
Office of the Comptroller of the Currency to pay the civil penalty,
the company said in a regulatory filing Tuesday.
For several years, the bank "maintained a weak management and
control framework for its fiduciary activities and had an
insufficient audit program for, and inadequate internal controls
over, those activities," the OCC said in its order. "Among other
things, the bank had deficient risk management practices and an
insufficient framework for avoiding conflicts of interest."
The regulator said the bank has since remedied these
deficiencies. JPMorgan, as part of the order, didn't admit or deny
the OCC's findings. The company disclosed earlier this month that a
resolution was in the works.
"We are committed to delivering best-in-class controls across
our business, and we have invested significantly in and enhanced
our controls platform over the last several years to address the
issues identified," said Darin Oduyoye, a JP Morgan spokesman.
The penalty comes almost two months after a separate $920
million settlement between JPMorgan and the Justice Department,
Commodity Futures Trading Commission and the Securities and
Exchange Commission. The settlement resolved allegations of
misconduct tied to manipulation of precious metals and Treasury
markets.
The OCC in recent years has paid close attention to internal
controls at banks, reprimanding some for taking too long to fix
weaknesses.
The OCC and the Federal Reserve last month fined Citigroup Inc.
$400 million and ordered the bank to fix its risk-management
systems. In the OCC order, the regulator said the fine was
punishment for the bank's "longstanding failure" to correct
problems in its risk and data systems. The bank said it was working
to address issues identified by the regulators.
The OCC also fined USAA Federal Savings Bank $85 million last
month for allegedly failing to maintain effective compliance-risk
management and information-technology risk-governance programs.
USAA has said it is working with the regulator to address the
issues.
--Dylan Tokar and David Benoit contributed to this article.
Write to Jack Hagel at jack.hagel@wsj.com and Josh Beckerman at
josh.beckerman@wsj.com
(END) Dow Jones Newswires
November 24, 2020 17:19 ET (22:19 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
JP Morgan Chase (NYSE:JPM)
Historical Stock Chart
From Apr 2024 to May 2024
JP Morgan Chase (NYSE:JPM)
Historical Stock Chart
From May 2023 to May 2024