JPMorgan Chase to pay $250M penalty over its deficient risk management and internal controls

Image source: JPMorgan Twitter account

JPMorgan Chase Bank, N.A. agreed to pay a civil penalty of $250 million for engaging in unsafe and unsound business practices related to internal controls and internal audit of fiduciary duties.

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The Office of the Comptroller of the Currency (OCC) imposed the penalty against the New York-based investment bank and financial services holding company, which manages $29.1 trillion assets, one of the largest worldwide.

JPMorgan Chase is offering clients a wide range of investment strategies through various investment vehicles. Given the huge amount of assets under management, its fiduciary duties are complex.

According to the OCC, JPMorgan Chase maintained a “weak management and control framework for its fiduciary activities” for several years. Its “risk management practices were deficient” and it does not have a sufficient framework to prevent conflicts of interests.

The federal regulator also found that the bank maintained inadequate “internal controls over its fiduciary activities and an insufficient audit program.