Company - - Nov 18,2016
JPMorgan Chase & Co. will pay more than $250 million to settle allegations from the US government that the bank hired children of Chinese leaders to win businesses in the country.
The US Securities and Exchange Commission (SEC) started investigating JPMorgan’s hiring three years ago in 2013. At the same time, Justice Department also opened a parallel investigation against the bank. SEC revealed that, there will be no particular individual that would be prosecuted at this point of time. .
The bank will pay roughly $130 million to the SEC and about $70 million to the Justice Department and more than $50 million to the Federal Reserve.
The authorities, which also includes criminal prosecutors, have accused JPMorgan Chase of forming a long run foreign bribery scheme – giving jobs in exchange of remunerative assignments from Chinese companies that were run fully or partially by the government. These relations came much beneficial for the investment bank, as the personal relations played a critical role in business decisions.
The bank argued that the hiring process had nothing to do with its own benefits, saying that hiring of employees with ‘connections’ was normal in China. However, the US authorities found the hiring processes to be in breach of The Foreign Corrupt Practices Act. JPMorgan is expected to accept the findings and verdicts of the investigators to reach a settlement. The settlement is said to be smaller in amount than it was once anticipated, largely because of the support and cooperation that the bank showed with the investigators. The bank has also secured a moral victory by avoiding any criminal charges or individual prosecutions. No one from JPMorgan has made any comments or announcements in front of the media, which has made this matter worse.