JPMorgan has encountered some of the cross-selling issues that have recently plagued Wells Fargo — but it’s nothing “systemic.”
That’s according to chief financial officer Marianne Lake, who said on a call following third-quarter earnings that JPMorgan is conducting a deep-dive investigation following the news about its competitor.
In September, Wells Fargo paid a $185 million settlement with regulators over accusations its employees wrongly opened as many as 2 million accounts in customers’ names without their knowledge between at least 2011 and 2015. CEO John Stump has since retired from the firm.
“We have over 50,000 people working in over 5,000 branches — it’s obviously the case that we will occasionally find issues, both issues of this nature and of other natures,” Lake said. “The important thing is that we are focused on finding them, finding them timely, and fixing them.”
Asked whether there had been at least a couple of cross-selling incidents, Lake responded yes.
“We can’t have zero defects; the point is that we are not building our incentives to get those behaviours,” she said. “We’re paying for deep relationships — if we find someone who’s abusing our code of conduct for this or any other reason, we will take action.”
She said JPMorgan reviews its incentive compensation plans for branches annually and has a complaints management process. Additionally, she said, the firm is taking an “inward deep-dive” given the news, and has not yet found any systemic issues.
“We’re not seeing anything that rises to the level that we would be concerned,” Lake said.
Asked whether JPMorgan bankers created fake bank accounts, or whether customers have complained about being forced into accounts, Lake responded, “No, nothing like that.”
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