Monday, September 17, 2012

JPMorgan Chase & Co. (NYSE:JPM) Reportedly In Midst of a Money Laundering Investigation

A banking regulator has been reviewing JPMorgan Chase & Co. (NYSE:JPM)’s compliance with US anti-money Laundering laws, as per a report from Reuters. This has made the largest US bank a fresh target of a big probe on how banks prevent transactions that involves drug money and authorized countries.

An independent wing of the Treasury Department, the Office of the Comptroller of the Currency is investigating JP Morgan’s systems that are supposed to supervise and filter such transactions.

The prospect of such inquiry and size of potential liabilities likely to be imposed on the bank could not be deciphered right away.

Joseph Evangelisti, JP Morgan’s Spokesman has refused to comment on Saturday.

JP Morgan has been expecting heightened scrutiny by regulators of its compliance with new regulations that included anti-money laundering laws, as per its quarterly filing with the US Securities and Exchange Commission.

The latest investigation comes at a time when regulators are making stepped-up efforts to crack down different aspects of money laundering. That includes transfers of drug cash through bank system and funds from countries that are facing international sanctions.

The Department of Justice is also being confronted with the same problem. It wants to ramp up the number of criminal cases under Bank Secrecy Act. The law needs financial institutions and their workers to take compulsory steps to stop money laundering.

US regulators are also doing their bit to examine illegal transactions that are tied to Venezuela.

British bank HSBC Holdings Plc has set aside $700 million this summer to cover investigations that were likely to result in one of the biggest settlement ever. A ‘pervasively polluted’ culture at the bank had faced strong criticisms by a US Senate report. The panel had investigated transactions that involved Mexico, The Cayman Islands, Saudi Arabia and Iran.

There have been smaller cases as such before in which comptroller’s office had targeted loopholes in the method banks use to clear checks connected to prospective money transactions. 

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