FINRA fined JP Morgan Securities $1.1 million for failing to timely disclose at least 89 instances of broker misconduct, including instances of registered representatives misappropriating funds, effecting unauthorized trades/unsuitable recommendations, forging/falsifying documents, borrowing from customers, and other disclosable events.
The regulator wrote that JP Morgan's own misconduct in failing to adhere to disclosure and reporting rules prevented or delayed FINRA, other firms, and the general public—including investors—from learning about allegations against JP Morgan reps, and the firm's failure to timely disclose stockbrokers' misconduct actually prevented FINRA from pursuing potential disciplinary action against at least 30 former JP Morgan brokers, advisers, and other representative personnel.
FINRA concluded that JP Morgan's failures primarily stemmed from the firm's failure to establish and maintain adequate supervisory systems, including deficient or non-existent written supervisory procedures.
This is not the first time FINRA has accused JP Morgan of possessing a deficient supervisory system.
In 2018, for instance, FINRA fined JP Morgan $2.8 million for deficiencies related to the SEC's Customer Protection Rule. In its disciplinary report, FINRA noted that JP Morgan's supervisory systems and related regulations were either deficient and/or failed.
If you invested with a JP Morgan Securities broker or investment adviser whose undisclosed history of misconduct—such as misappropriation or conversion of customer funds, unauthorized trading, suitability, or improper loans—has proven harmful to your interests because you were unable to gain an accurate understanding as to a broker's checkered past, please call an experienced FINRA arbitration attorney at The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.