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Articles Tagged with whistleblower


ICFBCFS and Chardan Capital Markets Accused of Anti-Money Laundering

FINRA has fined the Industrial and Commercial Bank of China Financial Services LLC (ICBCFS) $5.3M for “systemic anti-money laundering compliance failures.”  The self-regulatory organization contends that when clearing and settling the liquidation of over 33 billion penny stock shares between 1/2013 and 9/2015, the firm did not have in place an anti-money laundering program that was reasonable enough to identify and report possibly suspect transactions, especially when penny stocks were involved.  ICBCFS is settling the case without denying or admitting to the self-regulatory authority’s findings. It has, however, consented to an entry of the findings.

ICBCFS also agreed to pay an $860K penalty to settle a US Securities and Exchange Commission case alleging anti-money laundering violations and the failure to report billions of suspect penny stock sales.

The Commodity Futures Trading Commission will pay $30M to one whistleblower who provided information that brought about the $367M asset management settlement in a case against JPMorgan Chase & Co. (JPM). Federal regulators alleged that the bank didn’t tell wealth management clients about conflicts of interests that may have affected how the financial institution managed their money between 2008 and 2013. The two JPMorgan units involved were its nationally chartered bank and its securities subsidy.

JPMorgan, which is the biggest bank in the US according to assets, neglected to tell customers that it made money when it placed their money in hedge funds and mutual funds that earned the firm fees. Both high net worth customers and retail mutual fund customers were purportedly affected.

The bank was also accused of not telling investors that it’s wealth business preferenced its own proprietary products over others’ products when deciding where to invest clients ‘funds. JPMorgan was accused of violating its fiduciary duty when it failed to notify customers that more costly share classes of proprietary mutual funds were chosen for them. Although JPMorgan acknowledged its failure to properly disclose the information, the bank maintained that such omissions were not done on purpose, and it has since remedied the matter.

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