JP Morgan Chase (JPM) is reportedly under investigation by the U.S. Treasury Department for its relationship with UAE-based hedge fund Ocean Leonid Investments, according to an exclusive Bloomberg report. According to the report, Ocean Leonid Investments is reportedly tied to Iranian oil trader Hossein Shamkhani. Hossein is the son of Ali Shamkhani, a trusted ally of Iran’s Supreme Leader Ayatollah Ali Khamenei and a former top security official in Iran.
Don't Miss our Black Friday Offers:
- Unlock your investing potential with TipRanks Premium - Now At 40% OFF!
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
U.S. Treasury Department Is Examining JPM’s Compliance
The U.S. Treasury Department is investigating whether the banking giant adhered to all U.S. rules and regulations when it took on Ocean Leonid Investments as a client. Furthermore, the U.S. agency is particularly interested in Shamkhani’s activities and any potential compliance gaps in the bank’s dealings. According to the report, JPMorgan provided leverage to the hedge fund but is not required to end the relationship. This is because neither Shamkhani nor Ocean Leonid appears on U.S. sanctions lists. According to the U.S. federal law, financial institutions are required to monitor for suspicious activity in an effort to prevent illegal funds from flowing through the country.
Furthermore, the U.S. Federal Reserve is also looking into Western banks’ ties to Shamkhani’s network. This investigation is part of broader U.S. efforts to monitor financial institutions for suspicious activities tied to sanctioned regimes.
Is JPM Stock a Good Buy Now?
Analysts remain cautiously optimistic about JPM stock, with a Moderate Buy consensus rating based on 10 Buys, six Holds, and one Sell. Over the past year, JPM has surged by more than 60%, and the average JPM price target of $235.86 implies a downside potential of 3.6% from current levels.
