Troubles continue for JPMorgan Chase & Co (NYSE:JPM)
JPMorgan Chase & Co (NYSE:JPM) is in the midst of settling some investigations in the United States and the United Kingdom in connection with a trading loss of $6.2B. The bank has now agreed to pay penalties amounting to $920M after admitting that it had violated some securities-laws in 2012. A few top-level managers had held-back critical information from the company’s board.
The cease-and-desist order that was passed late last week by the SEC said that towards the end of April 2012, senior executives at the bank had strong evidence that some traders at their London chief-investment office had been pricing a derivatives-portfolio in a manner that it brought-down the reported losses.
This episode indicates that after having faced the worst financial-crises post the Great Depression, JPMorgan Chase & Co (NYSE:JPM) executives maintained weak internal controls, did not keep the board informed and also allegedly misled regulators. All of this amounted to a “pattern of misconduct”. Apart from this, the bank is also facing some investigations into the hiring practices it follows in Asia. Criminal probes related to energy trading and mortgage bond sales are the other legal battles it is facing.
More trouble brewing
In some latest news, JPMorgan Chase & Co (NYSE:JPM) has been slapped with the proposed class-action lawsuit. The allegation is that Social Security numbers are being printed on the outside of letters that are being mailed to its customers. These letters inform customers about how the procedures that the bank follows to protect their customers’ private information.
This lawsuit was filed in Chicago’s Federal Court and has accused United States’ largest bank of violating state and federal laws. The allegation also is that the bank’s customers have been subjected to higher risks of identity theft. JPMorgan Chase & Co (NYSE:JPM) sure seems to be caught in a legal imbroglio that might be very difficult to get out of unscathed.