NEWARK, N.J. (Legal Newsline) - New Jersey Acting Attorney General John Hoffman announced a settlement on Friday with J.P. Morgan Securities LLC to resolve allegations it allowed unregistered agents to accept orders for securities in New Jersey.
Between 2004 and 2011, J.P. Morgan allegedly employed sales assistants who accepted orders from New Jersey investors even though they weren't registered with the New Jersey Bureau of Securities. New Jersey's Uniform Securities Law requires that agents be registered with the bureau to accept orders for the purchase and sale of securities.
The practice allegedly extended to other U.S. states and territories in which client orders were accepted by agents not registered in those jurisdictions.
"Investors expect, demand, and deserve full compliance with the law when they entrust their money to an investment firm," Hoffman said. "J.P. Morgan fell short when it failed to ensure compliance with New Jersey's registration requirements when dealing with New Jersey investors."
J.P. Morgan also allegedly failed to maintain records identifying employees who accepted orders from investors in New Jersey and other jurisdictions.
Under the terms of the settlement, New Jersey will receive $50,460 in civil monetary penalties. J.P. Morgan also agreed to make changes to its registration policies, order entry systems and supervisory procedures to prevent the purchase and sale of securities by unregistered agents.