JPMorgan pays $2.5 billion for Bank Secrecy Act violations

America's largest financial institution has paid dearly for banking Bernie Madoff, whose $20bn Ponzi investment scheme collapsed in 2008. Under a deferred prosecution and other agreements announced 7 January 2014, JPMorgan will pay $2.5bn to US authorities to settle charges that it breached the Bank Secrecy Act (BSA) in its dealings with Madoff Securities. By Timon Molloy

Timon Molloy (timon.molloy@informa.com), Managing editor

The Department of Justice (DOJ) receives $1.7bn [1] - which it will transfer to the Madoff victims recovery fund - after the bank accepted a two-count criminal 'Information'. The first statutory allegation is that, in or about 2008, JPMorgan "did wilfully fail to establish an adequate anti-money laundering program" to ensure that details about the bank's clients gathered by its other lines of business, or from outside the US, were shared with compliance and AML personnel in the US. Secondly, the bank omitted to file a suspicious activity report (SAR) on Madoff Securities in October 2008.