JPMorgan Receives Heavy Fine For Inadequate Trade Reporting (2024)

Key Facts about this case:

• JP Morgan was fined $348.2m by US bank regulators for failing to maintain an adequate framework for correctly reporting their trading activities between 2014 & 2023.
• The bank failed to report billions of trades across 30 global trading venues
• Second time in 4 years JP Morgan has paid a large fine after paying $200M in 2021 for previous lapses in transaction record keeping.
• JP Morgan has been required to rebuild and improve its Trade Surveillance Framework, conduct a third party review of their policies, as well as clearing new trading venues with regulators as part of the settlement.
• Trade Surveillance process of monitoring and analysing trading activities in financial markets to detect and prevent potential instances of Market Abuse and Insider Trading.
• Trade surveillance helps regulatory authorities to monitor market activity, detect potential risks and enforce regulatory requirements in financial markets.

Looking at this from an African financial markets perspective, banks and other institutions with capital markets operations would need to ensure that they have adequate Trade Surveillance frameworks including monitoring software solutions to identify market abuse both internally and externally.