CFTC, J.P. Morgan Securities Settle Charges of Supervision Failures

By Stephen Nakrosis

The Commodity Futures Trading Commission on Thursday said it simultaneously filed and settled charges against J.P. Morgan Securities LLC.

According to the CFTC, J.P. Morgan failed to diligently supervise its business as a CFTC registrant. This resulted in J.P. Morgan failing to capture billions of orders in its surveillance systems, the regulator said.

The CFTC said J.P. Morgan admits the facts in the order in the sections pertaining to scope of surveillance-data gaps, and causes of surveillance-data gaps, and acknowledged its conduct in those sections violated CFTC regulations. Otherwise, the company neither admits nor denies the findings of fact, the CFTC said.

"The surveillance gaps resulted from J.P. Morgan's failure to configure certain data feeds to ensure complete trade and order data were being ingested by J.P. Morgan's surveillance tools," the CFTC said.

J.P. Morgan will pay a $200 million civil monetary penalty and desist from further violations of CFTC supervision requirements, the commission said. The civil monetary penalty could be offset by a total of $100 million of any payment made pursuant to a resolution with JPMorgan Chase Bank concerning surveillance gaps by the Office of the Comptroller of the Currency and the resolution with JPMorgan Chase & Co. concerning surveillance gaps by the Board of Governors of the Federal Reserve System, according to the CFTC.

Write to Stephen Nakrosis at stephen.nakrosis@wsj.com

(END) Dow Jones Newswires

May 23, 2024 18:34 ET (22:34 GMT)

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