What is Happening?
J.P. Morgan has been hit with a $250M fine. The SEC found insufficient management of conflicts of interest within the firm’s Asset Management and Wealth Management divisions.
Why does this Matter?
In September of this year, J.P. Morgan had a $920M settlement enforced, due to a “spoofing'” scandal that manipulated precious metals commodity markets and Treasuries. Tuesday, it was announced that the firm would take on an additional $250M charge for undisclosed practices in different business units.
Although the public is currently unaware of what J.P. Morgan Asset Management and Wealth Management are being held accountable for, this is not the first time either segment has been hit. In 2015 J.P. Morgan was fined over $300M for placing clients in investment vehicles with higher fees, without disclosing such information to clients.
“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.”
Will over $1B of monetary consequences be enough to prevent future shady business? At some point, J.P. Morgan could see the effects of these continual PR disasters.
This story was featured in the 11/25/2020 edition of the daily MarketBites Investment Newsletter written by the investment professionals at Taylor Hoffman Capital Management.
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Meet the Author
Jack graduated from the Robins School of Business at the University of Richmond with concentrations in Marketing and Finance in 2019. Prior to joining Taylor Hoffman, he worked in high-growth B2B SaaS marketing; assisting Fortune 100 firms to improve their web performance experience. A Long Island New York native, Jack’s hobbies include passionately supporting the Mets and Islanders, and he enjoys skiing whenever he can.