The shakeups continue at JPMorgan. It was reported today that JPMorgan Chase & Co. (NYSE:JPM) is losing its second chief compliance officer in as many years amidst never before seen regulatory and legal challenges at the bank.
Compliance chief leaves to work with former JPMorgan executive
Cindy Armine, the compliance chief for less than a year, is leaving and is expected to take a similar position at First Data Corporation, according to a report in the Wall Street Journal. First Data is run by former JPMorgan Chase & Co. (NYSE:JPM) executive Frank Bisignano, who has recruited several former JPMorgan executives since leaving in April of 2013, the report noted.First Data paid millions of dollars to JPMorgan for a pledge from the bank that it wouldn’t challenge any new hires, people familiar with the deal were quoted as saying. Armine and Bisignano worked together when Armine was also head of global compliance at Citigroup, Inc.
Headaches without easy answers
Armine was promoted to chief compliance officer in early 2013 in the wake of the firm’s London whale trading issue, replacing Martha Gallo, who retired 13 months ago. Armine’s resignation comes two years after Barry Zubrow was replaced as chief risk officer of JPMorgan Chase & Co. (NYSE:JPM) for the same “London whale” trade. While speculation was the trade was the culprit, a phone call between MF Global’s Jon Corzine and Zubrow, with witnesses present and documented in legal briefs, might have also presented problems.
Madoff ponzi scandal
Another difficult issue that could have dropped on Armine’s plate was the Bernie Madoff ponzi scheme, in which the bank has been accused of knowing about the Ponzi scheme, liquidating its positions, but doing nothing to prevent it, as reported in ValueWalk.
This past fall JPMorgan announced it was hiring 3,000 new compliance staff in the wake of regulatory and criminal scrutiny. In 2013 the bank received a record number of fines, totaling nearly $20 billion.
Lou Rauchenberger, chief administrative officer for the company’s corporate and investment bank, is expected to take over compliance duties in the interim, according to the internal memo cited in the report.