Regulators Outline Fixes for JPMorgan to Make Following London Whale Losses
A pair of federal oversight agencies have issued orders against JPMorgan Chase outlining improvements to be made in JPMorgan's Bank Secrecy Act/Anti-Money Laundering policies and the firm's Chief Investment Office, which was involved in the "London Whale" $6 billion trading loss.
The Federal Reserve Board issued two orders, one of which requires the company "to take corrective action to continue ongoing enhancements to its risk-management program and its finance and internal audit functions, particularly in regard to [its] Chief Investment Office." The second mandates improvements in the bank's compliance with the Bank Security Act and related anti-money-laundering requirements.
The Treasury Department's Office of the Comptroller of the Currency issued a single order addressing deficiencies in the bank's program for Bank Secrecy Act/Anti-Money Laundering (BSA/AML) compliance. The Office "found that the bank's BSA compliance program had critical deficiencies with respect to suspicious activity reporting, monitoring transactions, conducting customer due diligence and risk assessment, and implementing adequate systems of internal controls and independent testing."
JPMorgan said in an SEC filing that "a number of the enhancements and other actions required by the ... Consent Orders have already been, or are currently in the process of being, implemented by the Firm. The Firm is committed to the full remediation of all the issues identified in the Consent Orders."
JPMorgan Chase's Chief Investment Office was the unit that employed derivatives trader Bruno Iksil, the "London Whale," whose activities engendered billions of dollars in trading losses for the bank last May.
The article Regulators Outline Fixes for JPMorgan to Make Following London Whale Losses originally appeared on Fool.com.Eric Volkman has no position in JPMorgan Chase. The Motley Fool owns shares of JPMorgan Chase. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.