Authorities in the U.S. are investigating JP Morgan the investment bank, over claims the bank hired the children of influential officials in China to earn more business.
One claim by those involved in the case is the bank hired a son of a former bank regulator, who is now in charge of China Everbright an investment firm.
JP Morgan and China Everbright eventually completed a number of deals together. Earlier this month, JP Morgan said it had received a request for information about the matter from the Securities and Exchange Commission, the U.S. regulatory agency.
The daily also wrote that JP Morgan’s office in Hong Kong had also employed a railway official’s daughter as JP Morgan was chosen by The China Railway Group to advise it on a 2007 public flotation when it was able to raise over $5 billion.
Authorities later arrested the official in connection with another scandal involving bribery.
The paper said the document from the SEC did not have any direct tie between the hiring policy at JP Morgan and any business that had followed.
There was also no direct suggestion that those employees hired had not been suitable for the jobs they had been hired to perform, or that JP Morgan had been helped with securing new business through the hiring. The regulatory agency has not accused the bank of wrongdoing.
The SEC’s request of JP Morgan to supply information appeared in early August in a routine filing of a document, which said the SEC had requested information that related to the company’s employment of certain employers who had worked in Hong Kong.
SEC officials also confirmed that the agency had requested the information relating to the employment in Hong Kong of certain former employees, as well as business relationships the bank had with certain clients.
