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(Board of Governors of the Federal Reserve System and Office of the Comptroller of the Currency; January 14, 2013)
WASHINGTON -- The Federal Reserve Board on Monday issued two consent Cease and Desist Orders against JPMorgan Chase & Co., New York, New York (JPMC), a registered bank holding company. The first order requires JPMC to take corrective action to continue ongoing enhancements to its risk-management program and its finance and internal audit functions, particularly in regard to JPMC's Chief Investment Office (CIO). The Board's order follows the disclosure of significant losses in a large synthetic credit portfolio that was managed by the CIO. The second order requires JPMC to take corrective action to enhance its program for compliance with the Bank Secrecy Act and other anti-money laundering requirements at JPMC's various subsidiaries.
The Office of the Comptroller of the Currency on Monday issued two similar Consent Orders against JPMorgan Chase Bank, N.A., Columbus, Ohio.
Consent Cease and Desist Order #1
1. Source of Strength: The board of directors shall take appropriate steps to ensure that the Bank complies with the Consent Order issued by the OCC.
2. Board Oversight: Within 60 days of this Order, the board of directors shall submit to the Reserve Bank an acceptable written plan to continue ongoing enhancements to the board’s oversight of JPMC’s risk management, internal audit, and finance functions.
3. Risk Management: Within 60 days of this Order, JPMC shall submit to the Reserve Bank an acceptable written plan to continue ongoing enhancements to its risk management program, particularly with respect to the matters set forth below.
4. Finance: Within 90 days of this Order, JPMC shall submit to the Reserve Bank an acceptable written plan to continue ongoing enhancements to the finance function, particularly with respect to the CIO finance function.
5. Internal Audit: Within 90 days of this Order, JPMC shall submit to the Reserve Bank an acceptable written plan to continue ongoing enhancements to firmwide internal audit, particularly with respect to the matters set forth below.
6. & 7. Approval, Implementation, and Progress Reports to Federal Reserve
Consent Cease and Desist Order #2
1. Source of Strength: The board of directors shall take appropriate steps to ensure that the Bank complies with the Consent Order issued by the OCC.
2. Board Oversight: Within 60 days of this Order, JPMC’s board of directors shall submit to the Federal Reserve Bank of New York (the “Reserve Bank”) an acceptable written plan to continue ongoing enhancements to the board’s oversight of JPMC’s firmwide compliance risk management program with regard to compliance with BSA/AML Requirements.
3. Compliance Risk Management Program: Within 60 days of this Order, JPMC shall submit an acceptable written plan to the Reserve Bank to improve the firmwide compliance risk management program with regard to BSA/AML Requirements and the regulations issued by the Office of Foreign Assets Control of the United States Department of the Treasury
4. and 5. BSA/AML Compliance Program: Within 90 days of this Order, JPMC shall complete a review of the effectiveness of JPMC’s firmwide BSA/AML compliance program (the “BSA/AML Review”) and prepare a written report of findings and recommendations (the “BSA/AML Report”).
6. Progress Reports to Federal Reserve
7. Approval and Implementation of Plans to Federal Reserve
Consent Cease and Desist Order #1 (.pdf file)
Consent Cease and Desist Order #2 (.pdf file)
Federal Reserve Board Issues Two Consent Cease and Desist Orders Against JPMorgan Chase & Co.
(Board of Governors of the Federal Reserve System and Office of the Comptroller of the Currency; January 14, 2013)
WASHINGTON -- The Federal Reserve Board on Monday issued two consent Cease and Desist Orders against JPMorgan Chase & Co., New York, New York (JPMC), a registered bank holding company. The first order requires JPMC to take corrective action to continue ongoing enhancements to its risk-management program and its finance and internal audit functions, particularly in regard to JPMC's Chief Investment Office (CIO). The Board's order follows the disclosure of significant losses in a large synthetic credit portfolio that was managed by the CIO. The second order requires JPMC to take corrective action to enhance its program for compliance with the Bank Secrecy Act and other anti-money laundering requirements at JPMC's various subsidiaries.
The Office of the Comptroller of the Currency on Monday issued two similar Consent Orders against JPMorgan Chase Bank, N.A., Columbus, Ohio.
Consent Cease and Desist Order #1
1. Source of Strength: The board of directors shall take appropriate steps to ensure that the Bank complies with the Consent Order issued by the OCC.
2. Board Oversight: Within 60 days of this Order, the board of directors shall submit to the Reserve Bank an acceptable written plan to continue ongoing enhancements to the board’s oversight of JPMC’s risk management, internal audit, and finance functions.
3. Risk Management: Within 60 days of this Order, JPMC shall submit to the Reserve Bank an acceptable written plan to continue ongoing enhancements to its risk management program, particularly with respect to the matters set forth below.
4. Finance: Within 90 days of this Order, JPMC shall submit to the Reserve Bank an acceptable written plan to continue ongoing enhancements to the finance function, particularly with respect to the CIO finance function.
5. Internal Audit: Within 90 days of this Order, JPMC shall submit to the Reserve Bank an acceptable written plan to continue ongoing enhancements to firmwide internal audit, particularly with respect to the matters set forth below.
6. & 7. Approval, Implementation, and Progress Reports to Federal Reserve
Consent Cease and Desist Order #2
1. Source of Strength: The board of directors shall take appropriate steps to ensure that the Bank complies with the Consent Order issued by the OCC.
2. Board Oversight: Within 60 days of this Order, JPMC’s board of directors shall submit to the Federal Reserve Bank of New York (the “Reserve Bank”) an acceptable written plan to continue ongoing enhancements to the board’s oversight of JPMC’s firmwide compliance risk management program with regard to compliance with BSA/AML Requirements.
3. Compliance Risk Management Program: Within 60 days of this Order, JPMC shall submit an acceptable written plan to the Reserve Bank to improve the firmwide compliance risk management program with regard to BSA/AML Requirements and the regulations issued by the Office of Foreign Assets Control of the United States Department of the Treasury
4. and 5. BSA/AML Compliance Program: Within 90 days of this Order, JPMC shall complete a review of the effectiveness of JPMC’s firmwide BSA/AML compliance program (the “BSA/AML Review”) and prepare a written report of findings and recommendations (the “BSA/AML Report”).
6. Progress Reports to Federal Reserve
7. Approval and Implementation of Plans to Federal Reserve
Consent Cease and Desist Order #1 (.pdf file)
Consent Cease and Desist Order #2 (.pdf file)
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