JPMorgan Chase & Co. agreed Thursday to pay more than $264 million in sanctions to the SEC, Justice Department and the Federal Reserve Board for violating the Foreign Corrupt Practices Act via the firm's referral hiring practices.
JPMorgan will pay more than $130 million to settle SEC charges that it won business from clients and corruptly influenced government officials in the Asia-Pacific region by giving jobs and internships to their relatives and friends.
JPMorgan also is expected to pay $72 million to the Justice Department and $61.9 million to the Federal Reserve Board of Governors for a total of more than $264 million in sanctions.
According to an SEC order issued on Thursday, investment bankers at JPMorgan's subsidiary in Asia created a client referral hiring program that bypassed the firm's normal hiring process and rewarded job candidates referred by client executives and influential government officials with well-paying, career-building JPMorgan employment.
"During a seven-year period, JPMorgan hired approximately 100 interns and full-time employees at the request of foreign government officials, enabling the firm to win or retain business resulting in more than $100 million in revenues to JPMorgan," the order states.
Andrew Ceresney, director of the SEC's Enforcement Division, said in announcing the sanctions that JPMorgan engaged in a "systematic bribery scheme by hiring children of government officials and other favored referrals who were typically unqualified for the positions on their own merit."
