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JPMorgan Hit With $250M Fine

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JPMorgan Chairman & CEO Jamie Dimon (Photo: AP)

The Office of the Comptroller of the Currency assessed a $250 million civil money penalty against JPMorgan Chase Bank for failing to maintain adequate internal controls and internal audit over its fiduciary business.

The OCC found the bank’s risk management practices “were deficient and it lacked a sufficient framework to avoid conflicts of interest.”

The deficiencies, the OCC said, “constituted unsafe or unsound practices and resulted in a violation of 12 CFR 9.9, which requires a suitable audit over all significant fiduciary activities.”

The bank has remediated the deficiencies that led to the action, the OCC said. The OCC penalty will be paid to the U.S. Treasury Department.

JPMorgan, the OCC said, “maintains one of the world’s largest and most complex fiduciary businesses with total fiduciary and related assets of $29.1 trillion, including $1.3 trillion in fiduciary assets and $27.8 trillion of non-fiduciary custody assets.”

JPMorgan provides a broad range of investment strategies to its fiduciary clients through a variety of investment vehicles, the OCC stated.

JPMorgan said in a statement: “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.”

Three months ago, the bank was ordered to pay $920 million over manipulative trading of metals futures and Treasury securities. The fine was  the biggest monetary penalty ever imposed by the Commodity Futures Trading Commission.