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JPMorgan to pay US$135m for improper handling of ADRs
JPMorgan Chase & Co. will pay US$135 million to settle Securities and Exchange Commission (SEC) allegations that it mishandled US securities that represent shares of foreign companies.
The bank improperly provided what is known as American depositary receipts (ADRs) to brokers when neither the brokers nor their clients held shares in foreign companies that were required to support such transactions, the SEC said in a statement on Wednesday.
Without admitting or denying the claims, JPMorgan agreed to pay a US$49.7 million fine and US$85.4 million in disgorgement and interest. Wall Street's main regulator has made ADR sales a focus of its enforcement efforts.
Last month, Citigroup Inc. agreed to pay US$38.7 million to settle similar SEC charges. Deutsche Bank AG agreed to pay about US$75 million in July.
Sanjay Wadhwa, senior associate director of the SEC's New York regional office, said: "Our investigation continues into brokerage firms that profited by making use of these improperly issued ADRs." BLOOMBERG