JPMorgan Chase & Co’s monitoring system for suspect money transactions is being probed by the United States. The probe is centered around the personnel and the system that the bank uses to guard against illegal flows of money. It is required that banks file suspicious activity reports, which cost money. Regulators and banks disagree a lot about whether or not the reports find money that can be tied to terrorism, narcotics or sanctioned countries.
The bank could be issued a regulatory order from the U.S. Office of the Comptroller of the Currency. The order would then require the bank to come up with a system that is more secure when monitoring money laundering. The investigation could broaden to include other agencies such as the U.S. Justice Department. The probe could find that the bank allowed illegal funds to move through it.
The Office of the Comptroller of the Currency is a separate segment in the Treasury Department. The probe from the OCC focuses on offices of JPMorgan located in Columbus, Ohio; Wilmington, Delaware; Arlington and San Antonio, Texas and Phoenix, Arizona. The bank operates anti-money laundering offices in these cities.
The offices in those cities and the headquarters for JPMorgan in New York are the offices tasked with stopping money laundering within the bank. They are responsible for permitting foreign banks to access the U.S. banking system through JPMorgan. The probe of JPMorgan comes at a time when the bank’s top anti-money laundering division official is switching to another position. The official, William Langford, is moving to general counsel of the bank from head of the global anti-money laundering team at the bank.
Langford has been at JPMorgan since 2006 and was viewed as a candidate for the top position with the Treasury Department’s anti-money laundering unit. This unit is known as the Financial Crimes Enforcement Network, also known as Fincen.