JPMorgan Fined $30 Million by SFC for Dark Pool Failings
Inadequate implementation of dark pool venue systems and controls in breach of Hong Kong regulator’s rules.
Alongside failure to implement adequate systems and controls for client facilitation and principal trading business, and short selling activities, JPMorgan Broking (Hong Kong), JPMorgan Securities (Asia Pacific) and JPMorgan Securities (Far East) were reprimanded and fined $15 million, $12 million, and $3 million, respectively, by the SFC for breaching regulations aorund its dark pool systems implementation.
The Hong Kong regulator found that following the authorization of JPMorgan's dark pool venue JPMX to begin activity as a pure agency-to-agency matching platform, "numerous principal orders of JPMorgan were incorrectly routed into the agency pool of JPMX for matching between March and July 2012 due to human and systems errors," with none of the orders crossed in JPMX.
JPMorgan is the latest firm to fall foul of wider regulations governing the activity of dark pool venues in Hong Kong, after BNP Paribas received a $15 million fine in August after failing to give priority to highly priced orders as had originally been claimed by the French bank.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@waterstechnology.com or view our subscription options here: https://subscriptions.waterstechnology.com/subscribe
You are currently unable to print this content. Please contact info@waterstechnology.com to find out more.
You are currently unable to copy this content. Please contact info@waterstechnology.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@waterstechnology.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@waterstechnology.com
More on Regulation
Will SEC reporting proposal supercharge alt data providers?
An SEC proposal that would let companies opt out of quarterly reporting disclosures could be a boon for alternative data providers.
Paxos wins temporary approval for blockchain clearing push
Blockchain infrastructure company will have a period of 18 months to “ramp up” readiness for operations, per the SEC’s approval letter.
Is a 2027 T+1 move too soon for Hong Kong?
The Waters Wrap: Wei-Shen examines HKEx’s discussion paper on moving to T+1 in Q4 2027. A move so soon has its benefits but still requires careful consideration, she says.
EU AI Act leaves agents in regulatory limbo
A new paper published by AI ethicists draws attention to a hole in the EU AI Act surrounding high-risk agentic systems.
AI governance rules coming soon, says CFTC chair
Selig doesn’t want to stifle innovation, but says trading or advice algos will need guardrails.
Hitting the Great Wall: Details scarce on China’s Xinchuang initiative
In a quest to learn more about China’s Xinchuang initiative, Wei-Shen finds trying to get information feels like running into a wall over and over again.
24X says requested SIP exemption won’t break the market
In a new letter to the SEC, the startup exchange says data infrastructure that operates like the SIP is available as it looks to launch overnight trading this summer.
How banks are utilizing new AI forms in their KYC process
Execs from JP Morgan, ING, and Standard Chartered explain how they are looking to use agentic AI to streamline KYC workflows.
