US AUTHORITIES are investigating JP Morgan’s hiring practices in China, suspecting the bank of hiring well connected children of officials to win business in the country, it emerged over the weekend.
Documents leaked to the New York Times show the Securities and Exchange Commission (SEC) is investigating claims the bank hired the son of a financier from the China Everbright Group and the daughter of a railway official before winning major contracts.
More broadly the document is said to be concerned about the hiring of staff who worked with the Ministry of Railways over the past six years.
“We publicly disclosed this matter in our 10-Q filing on August 7, and are fully cooperating with regulators,” said JP Morgan.
Its 10-Q document referenced “a request from the SEC division of enforcement seeking information and documents relating to, among other matters, the firm’s employment of certain former employees in Hong Kong and its business relationships with certain clients.”
Industry sources indicated the practice of hiring relatives of politicians and officials may be widespread among major western firms operating in the country.