JP Morgan Fined 920 Million Dollars

JP Morgan Fined 920 Million Dollars.

US owned merchant ‘super bank’ has been fined $920 million (£570m) by combined US and UK financial regulators.

 The UK Financial Conduct Authority had originally fined JP Morgan £137m for its failings in the supervision on traders resulting in unsupervised increased risk taking, financial losses and other rule breaches.

The combined investigation by US and UK regulators has seen a co-ordinated approach to get to the heart of JP Morgan to improve compliance standards.

Comment

Large banking groups offer the largest risk to consumer and market detriment and have for many years appear to have not taken their unique position in looking after our money, investments and pensions in a structured and supervised manner.

The regulatory review found rules breaches at all levels from the bottom up to senior executive levels.  This particular investigation into the so called “London Whales”, i.e. the big investor boys and girls and rogue traders has taken some time and we suggest is possibly endemic across many merchant bank groups.

The size of the fine, just short of $1bn will send shockwaves across the financial sector.

We have long campaigned that a fine of say £1.5m to a bank, which has been common, equates to just a few hours trading profits and does little to encourage a systematic change in banking culture.  A $1bn fine will make banking groups stand up and take notice.  ‘High risk of consumer detriment’ firms cannot ignore their socially responsible position.