J.P. Morgan May Face Disciplinary Action
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J.P. Morgan Chase & Co. said the Securities and Exchange Commission notified it that it may face disciplinary action for sharing profits with clients who received shares in initial public offerings arranged by the bank.
J.P. Morgan, which paid a $6-million fine and was censured by the NASD in February for similar charges, said in a filing with the SEC that it told the commission discipline isn’t warranted.
Last month, the NASD said Hambrecht & Quist, a San Francisco-based securities firm that J.P. Morgan Chase bought in December 1999, allocated shares of IPOs to favored clients who paid the firm commissions that were 20 times higher than usual.
J.P. Morgan shares rose 52 cents to $23.33 on the New York Stock Exchange.
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