JPMorgan Chase Unit to Pay $250 Million Penalty Over Poor Internal Controls
26 Nov 2020

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.

By Jack Hagel and Josh Beckerman, The Wall Street Journal, 24 September 2020

Read more at The Wall Street Journal

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