The U.S. Securities and Exchange Commission (SEC) has brought charges against J.P. Morgan Securities LLC (JPMS) and J.P. Morgan Investment Management Inc. (JPMIM), both affiliates of JPMorgan Chase & Co. These charges encompass five distinct enforcement actions addressing issues such as misleading disclosures to investors, breach of fiduciary duty, unauthorized joint transactions and principal trades, and failure to make customer-centric recommendations.
The SEC disclosed that the two affiliates have consented to pay over $151 million in combined civil penalties and voluntary payments to investors to settle four of these cases. In one particular case involving JPMS, no penalty was imposed, due to JPMS's cooperation during the investigation and their implementation of corrective actions.
According to the SEC's findings, from July 2017 to October 2024, JPMS did not adequately disclose the financial incentives offered to themselves and some of their financial advisors when recommending their own Portfolio Management Program over third-party managed advisory programs provided by JPMS.
