Chase Bank Fined $200 Million for ‘Widespread’ Record-Keeping Failures, Unapproved Communications

by Harry Wilmerding

 

Federal regulators hit the largest bank in the U.S. with a $200 million fine Friday for failing to keep track of employees’ use of messaging apps, including WhatsApp, to evade federal record-keeping laws.

The Securities and Exchange Commission (SEC) announced Friday that a subsidiary of JPMorgan Chase & Co. would pay $125 million after admitting to “widespread” record-keeping failures. The bank will pay an additional $75 million fine to the Commodity Futures Trading Commission for allowing unapproved communications since 2015.

“Since the 1930s, recordkeeping and books-and-records obligations have been an essential part of market integrity and a foundational component of the SEC’s ability to be an effective cop on the beat,” SEC Chair Gary Gensler said in the press release. “As technology changes, it’s even more important that registrants ensure that their communications are appropriately recorded and are not conducted outside of official channels in order to avoid market oversight.”

“As today’s order reflects, JPMorgan’s failures hindered several Commission investigations and required the staff to take additional steps that should not have been necessary,” SEC Deputy Director of Enforcement Sanjay Wadhwa said in the press release. “This settlement reflects the seriousness of these violations. Firms must share the mission of investor protection rather than inhibit it with incomplete recordkeeping.”

Federal law requires firms to keep detailed records of electronic messages between brokers and clients for regulators to monitor whether firms are avoiding anti-fraud and antitrust laws, according to CNBC.

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Harry Wilmerding is a reporter at Daily Caller News Foundation.
Photo “Chase Bank” by Elvert Barnes CC BY-SA 2.0.

 

 

 


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