U.S. FINRA Fines JPM $1.1 Trade Orders

On 13 September, FINRA fined JPMorgan $1.1mn for trade order system.

  • J.P. Morgan Securities LLC fined in relation to order management systems (OMS).

Alleged Violations

  • Followed creation of separate OMS for cash institutional clients, and retail clients.
  • Did not account for filter in old OMS causing over-advertisement of trade volume.
  • Erroneously captured volume already advertised on trade date, when later swept
    for volume delayed for advertising, per client preference on trade date plus three.
  • The firm’s old system also did not filter out replicated parent-child order volume.
  • Thus, institutional client trade advertised on trade date, was submitted again for
    advertisement, and for some parent-child orders, more than once, on T+3 basis.
  • Higher impact as institutional clients moved to new OMS over four-month period.
  • Overstated advertised trade volume by billions of shares, using Bloomberg, AutEx.
  • Person who reviewed did not have access to firmwide volume due to info barriers.
  • Firmwide execution volume was not readily accessible to individuals doing reviews.
  • Limited ability to know volume for any security to ensure accurate advertisement.
  • Lacked supervisory system to review accuracy of volume advertised on T+3 basis.


  • Required to revise procedures, provide report on implementation and performance.