The Financial Industry Regulatory Authority today announced it has censured and fined J.P. Morgan Securities LLC $1.1 million for failing to “timely disclose” 89 internal reviews or allegations of misconduct by its registered representatives and associated persons spanning a six-year period.

J.P. Morgan’s reporting failures, which ran from January 2012 until April 2018, included instances where there were customer and company complaints alleging reps had misappropriated customer and company funds, committed fraud, borrowed from customers, forged, falsified or altered documents, engaged in unauthorized trading, made unsuitable recommendations and engaged in other suspicious activity, Finra said.

The alleged failures by J.P. Morgan Securities (JPMS), which employs 26,000 registered persons,  “prevented or delayed regulators, other member firms, and the public from learning about those events and, in certain instances, prevented Finra from pursuing potential disciplinary action,” Finra said in its settlement.

“Firms must live up to their responsibility as a gatekeeper and disclose allegations in a timely, accurate and complete manner. This disclosure responsibility is essential to providing transparency and maintaining the integrity of our industry,” said Susan Schroeder, executive vice president of Finra's Department of Enforcement, in a statement.

"Finra member firms have a responsibility to their fellow member firms, to Finra and other regulators, and to the investing public to disclose allegations of serious misconduct by their registered representatives,” Schroeder added.

“The firm's failure to disclose the required Information presented significant risks,” Finra said in the settlement.  For example, the JPMS failed to disclose, or timely disclose, internal reviews about and allegations that 13 reps misappropriated funds from banking customers and five reps misappropriated company funds.

In addition, 36 of the reps under review for allegations became associated with other member firms before JPMS disclosed the required Information about them, Finra said.

JPMS' delays prevented Finra from pursuing potential disciplinary action against 30 of the former JPMS representatives over whom Finra's jurisdiction expired before JPMS disclosed the allegations.

In settling this matter, JPMS neither admitted nor denied the charges, but consented to the entry of Finra's findings.

JPMS did not immediately respond to a request for comment on the settlement.

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