London - JPMorgan Chase, the biggest US bank by assets, was banning the use of multi-dealer online chat rooms and the use of such chat rooms among staff for social purposes, a person familiar with the matter said yesterday.
Chat rooms have been a focus for regulators probing manipulation of benchmark interest rates and possible rigging in the $5.3 trillion (R55 trillion) a day foreign exchange market.
Chat communications featured prominently in a five-year probe into the rigging of the London interbank offered rate, which has already cost banks billions of dollars in settlements.
The source said JPMorgan’s decision was unrelated to the foreign exchange probes which first surfaced in June, noting this had been under review at the bank since early this year.
“This has always been about more than foreign exchange,” the source said, adding that the casual nature of online chat rooms increased the potential for “inappropriate” remarks to be made. The ban will come into force later this week. Bilateral online chats between JPMorgan traders and traders at other financial institutions were under review, while external chats between JPMorgan staff and clients would still be permitted, the source said.
JPMorgan declined to comment because the plans have yet to be finalised. - Reuters