J.P. Morgan's Australian unit has been fined for permitting suspicious client orders to be placed on the futures market.
The Australian Securities and Investments Commission (ASIC) has fined J.P. Morgan Securities Australia A$775,000 ($509,000) for «permitting suspicious client orders to be placed on the futures market, ASX 24», according to a statement.
ASIC said that the bank failed to detect 36 suspicious orders on the Eastern Australia Wheat futures market between January 11 and March 3 of 2022. The orders were placed «close to the end of a trading session to influence the daily settlement price of a derivate contract».
No Contest
According to the regulator, J.P. Morgan did not contest the allegation and paid the fine. It also complied with the infringement notice which is not an admission of guilt or liability.
«There are real world consequences for this sort of behavior which is why tackling manipulation in energy and commodities derivatives markets has been an ASIC priority. Farmers use these contracts to manage wheat price fluctuations which can affect what Australians pay at the checkout,» said ASIC deputy chair Sarah Court.
«The [Market Disciplinary Panel’s] decision emphasizes that market participants cannot solely rely on automated trade monitoring systems to detect potential misconduct and must take immediate action once alerted to misconduct by ASIC.»
