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FINRA fines J.P. Morgan $1.25M for failing to screen thousands of employees

Jaclyn Jaeger | November 27, 2017

The Financial Industry Regulatory Authority fined J.P. Morgan Securities $1.25 million for failing to conduct timely or adequate background checks on approximately 8,600—or 95 percent—of its non-registered employees.

Federal securities laws require broker-dealers to fingerprint employees “working in a non-registered capacity who may present a risk to customers based on their positions,” FINRA stated. “Fingerprinting helps firms identify if a person has been convicted of crimes that would disqualify them from being associated with a firm, absent explicit regulatory approval. Federal banking laws require banks to conduct similar checks on banking employees using a more limited list of disqualifying events.”

FINRA found that from January 2009 through May 2017, J.P. Morgan did not fingerprint approximately 2,000 of its non-registered employees in a timely manner... To get the full story, subscribe now.