JP Morgan, Bank of America subject of money laundering probe
New York, NY, United States (4E) – U.S. financial regulators are reportedly investigating JP Morgan Chase and Bank of America for possible breaches that allowed the flow of money to drug dealers or terrorists, according to a The New York Times report on Saturday.
The report says that the Office of the Comptroller of the Currency (OCC) is taking the lead in investigating both banks for money laundering activities. The OCC is the federal agency with oversight powers over big banks.
Money laundering makes illegally obtained money appear like it came from legitimate sources or activities.
Federal and state authorities are investigating whether the banks failed to properly monitor transactions in their branches that opened the door for criminal organizations to launder money into the U.S.
The Times report also said that the probe is still ongoing but regulators are now considering measures against JP Morgan that could include a cease-and-desist order that would force the bank to address the gaps in oversight.
The Justice Department as well as the Manhattan District Attorney’s office are involved with the investigation, according to the Times. Both banks, the OCC, Manhattan District Attorney’s office and Manhattan U.S. Attorney’s office declined to comment.
The past several months have been a public relations nightmare for big banks. London-based bank Barclays PLC settled with authorities for its alleged manipulation of Libor rates. Another British bank, Standard Chartered PLC, settled charges with the New York Department of Financial Services for improperly handling transactions for Iran. JP Morgan revealed that it lost billions of dollars in a trading loss.