Home Alts News FINRA Censures and Fines J.P. Morgan Securities $750,000

FINRA Censures and Fines J.P. Morgan Securities $750,000

The Financial Industry Regulatory Authority announced that it has censured and fined J.P. Morgan Securities LLC for failing to supervise five incorrect orders.

The firm has been a FINRA member since December 1936 and is headquartered in New York, New York, with over 30,000 registered representatives and over 5,400 branches nationwide.

From January 2019 to July 2022, FINRA says the firm’s financial risk management controls and supervisory procedures were not reasonably designed to prevent certain erroneous orders that exceeded appropriate price or size parameters, on an order-by-order basis or over a short period of time, or that indicated duplicative orders.

FINRA says the firm’s market access controls failed to prevent five erroneous orders routed to exchanges and alternative trading systems.

Specifically, among four other errors, on Jan. 30, 2019, a firm trader on the program trading agency desk routed to the market an order to purchase 50,000 shares of an equity security. The trader intended to enter a limit price of $268.50, but mistakenly input $286.50. The firm received executions with prices over 5% higher than the last execution in the market prior to entry of this order. The firm submitted clearly erroneous filings and approximately half of the 50,000-share order, executions above $276.57, were busted.

J.P. Morgan Securities LLC agreed to a censure and to pay a total fine of $750,000 to be paid jointly to Nasdaq and FINRA, of which $187,500 is allocated to FINRA.

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