WASHINGTON — The Securities and Exchange Commission’s enforcement staff has notified JPMorgan that it is considering filing an enforcement action against the firm over alleged securities law violations in connection with the bidding of various financial instruments associated with municipal securities.
In a 10-K statement filed with the SEC yesterday, J.P. Morgan Chase & Co. said the firm received a so-called Wells notice from the staff of the SEC’s Philadelphia regional office on March 18.
The notice appears to be related to the SEC civil investigation of bid-rigging and other anti-competitive practices in derivatives and investment products like guaranteed investment contracts in the muni market.
The firm should have an opportunity to respond in writing, and to even request an oral hearing with SEC officials, to try to talk the staff out of recommending an enforcement action.
Several former JPMorgan bankers have been notified also that they are targets of a grand jury investigation in Manhattan that is related to the Justice Department’s parallel criminal probe of alleged antitrust practices in the muni market.