JP Morgan Chase Bank Settles Case With Sebi; Pays Rs 22.10 Lakh

JP Morgan Chase Bank settled the matter through a settlement order without admitting or denying guilt in the case
JP Morgan
JP Morgan

JP Morgan Chase Bank N.A on Friday settled with markets regulator Sebi a case pertaining to alleged violations of FPI rules on payment of Rs 22.10 lakh towards the settlement amount.

The matter has been settled by JP Morgan Chase Bank (JPMC) through a settlement order "without admitting or denying the findings of fact".

"It is hereby ordered that the instant adjudication proceedings initiated against JPMC vide show cause notice (SCN) dated September 23, 2022, and supplementary show cause notice (SCCN) dated December 29, 2022, is disposed of," Sebi's Adjudicating Officer Asha Shetty said in a settlement order.

Sebi had received a letter in August 2021 from JPMC, wherein the regulator was informed about the delay in intimation of change in material information (merger) of Fidelity Investments Money Management (FIMM), which was registered as FPI, with its affiliate Fidelity Management & Research Company (FMRC). 

Pursuant to receipt of the communication, the market watchdog conducted an examination and observed that the merger of FIMM with FMRC was resulted in cessation of FIMM, the entity which was registered as FPI. 

However, after the merger, the surviving entity FMRC, which had not obtained FPI registration, operated in the Indian securities market under the name, accounts and FPI registration of FIMM. 

It was also observed that JPMC failed to prevent FMRC from trading in the securities market despite having material on record that indicated that FIMM had merged into FMRC and FMRC did not have a valid FPI registration.

Further, Sebi initiated adjudication proceedings against the Noticee (JPMC) for allegedly violating the provisions of Foreign Portfolio Investors (FPI) norms.

Following this, Sebi issued a show cause notice and a supplementary show cause notice in September and December 2022, respectively to JPMC.

JP Morgan Chase filed the settlement application with Sebi and proposed to settle the alleged violations on payment of Rs 22.10 lakh. The amount was approved by the regulator.

Accordingly, JP Morgan Chase remitted the amount and settled the case with the regulator.

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