Essay, Pages 3 (607 words)
The purpose of this paper is to discuss the effects of how JP Morgan Chase, the biggest U.S. bank, announced trading losses from the decision make by its Chief Investment Office in the amount of $5.8 billion. It will also discuss actions taken by the Securities and Exchange Commission (SEC) for the misconduct on the part of JP Morgan Chase.
Securities and Exchange Commission (SEC) Takes Action
I would like to begin by briefly explaining the purpose and mission of the U.
S. Securities and Exchange Commission.
The SEC was designed to protect investors, maintain, fair, orderly, and efficient markets and to facilitate capital formation. The SEC requires public companies to disclose significant and meaningful financial information to the public in order to guarantee security within the U.S. Federal prosecutors and the securities regulators filed charges against the Chief Investment Office (CIO) consisting of two JP Morgan Chase traders for the massive trade losses totaling $5.8 billion. The employees were charged with conspiracy, wire fraud, falsifying financial records and making false filings with the Securities and Exchange Commission. The Securities and Exchange Commission simultaneously filed a corresponding civil complaint in which the agency signaled it would hold the bank accountable for disclosing inaccurate information to investors about the trading.
Elements of Valid Contract – Good Faith and Fair Dealing in Banking Relationships Chapter 7 of The Legal Environment describes the element of what is contained in a valid contract. “Every contract contains and implied covenant of good faith and fair dealing in its performance that imposes on each party a duty not to do anything that will deprive the other party of the benefits of the agreement.
(The Legal Environment, (2013), p.190). I feel it is important for both consumers and bank to ensure they are acting in accordance with good faith and fair dealing. With complete understanding, the banks are ensuring they are doing everything necessary to conduct business with its consumers. As long as banks act in accordance with the terms of a contract or agreement, they should have contented with the covenant of good faith and fair dealing.
Intentional and Negligent Tort Actions
An intentional tort transpires when an individual intentionally causes damage or injury to another person their property. Some examples are abuse, kidnapping or assault. A negligent tort transpires when an individual causes damage or injure to another without the intent to do so. An example of this would be a car accident or if someone accidentally slips, falls and becomes injured. Interference with Contractual Relations, Participating in Breach of Fiduciary Duty – The tort of interference with contractual relations protects the rights of a legally binding contract and requires the intent to interfere if such agreement has been breached. In the case of JP Morgan Chase I would be able to succeed based on the fact that the act of intentional tort action was carried out. The employees of JP Morgan Chase intentionally falsified financial records and committed the act of fraud.
Protection of Online Banking
In today’s world of online banking, the technology is simply an amazing necessity. Wells Fargo, for instance has “implemented firewalls, anti-malware defenses, password encryptions, application security testing and activity monitoring”. This provides a great deal of comfort to the consumer in ensuring their banking information and online account is protected. As an added measure, I feel banks should take that extra measure in continuing to be innovative by implementing new and diverse solutions to protect online banking.
- McKoy, Kevin, (2013) USA Today
- Bernstein, Harry, (2009). Negligence and Intentional Tort Law
- Douglas, Danielle, (2012). Banks Layer up on Security to Protect Customers. The Washington Post