JP Morgan Chase receives £3m fine for poor records

JP Morgan Chase: Poor records fine. Picture: Getty

The Financial Conduct Authority (FCA) said yesterday that the failings were not  corrected until it brought them to the bank’s attention as part of its wider review of wealth management firms in Britain.

“No matter who they are, customers of wealth managers should be able to expect the firm to keep complete, up-to-date  client records so that they can give the right advice,” the FCA’s enforcement director, Tracey McDermott, said in a statement.

“In this case the firm did not have complete records, nor did its management have the information they needed to recognise this.”

The FCA, which took over responsibility for investor protection from the now-defunct Financial Services Authority this spring, said the failings at JP Morgan Chase continued for more than two years.

The regulator said it exposed customers to the risk that they would be given the wrong advice and inappropriate investments, though no actual harm to customers had so far been identified.

But an independent review of 25 customers found “significant gaps” in the information the bank had on 22 of them, including how much risk the customer was comfortable with.

The FCA said that, on being informed, the bank acted promptly to improve its systems and began an overhaul of how it assesses if investments are suitable for customers.

JPMorgan, whose fine was cut 30 per cent due to an early stage settlement, said it had co-operated with the FCA and had enhanced its procedures.