A federal bribery investigation into whether JPMorgan hired the children of key Chinese officials to help it win business is the latest in a series of legal headaches for Chief Executive Jamie Dimon.
Reuters News reports that Dimon piloted the bank through the financial crisis, but it is now facing at least a dozen investigations from federal agencies and state and foreign governments, including over the 'London Whale' trading scandal that cost it more than $6.2bn.
In the latest probe, the Securities and Exchange Commission (SEC) is looking at whether the bank's Hong Kong office hired the children of powerful heads of state-owned companies in China with the express purpose of winning underwriting business and other contracts, a person familiar with the matter said.
U.S. law does not stop companies from hiring politically well-connected executives. But hiring people in order to win business from relatives can be bribery, and the SEC is investigating JPMorgan's actions under the U.S. Foreign Corrupt Practices Act.
Whatever the outcome of the latest investigation, Dimon's time is increasingly being consumed by regulatory matters.
Federal prosecutors on Wednesday brought criminal charges against two former JPMorgan traders, accusing the pair of deliberately understating losses in the 'Whale' scandal. The SEC is seeking an admission of wrongdoing from the bank in a parallel civil action, a rare step for the government agency.
And last month, the bank agreed to pay a $285m penalty and give back $125m of trading profits in a settlement with the Federal Energy Regulatory Commission for alleged power market manipulation. JPMorgan neither admitted nor denied violations.
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