J.P. Morgan Chase put allegations of currency-fixing largely behind it with a guilty plea, but it's not out of the woods yet.

With its new felony record, America's biggest bank needs to seek the Department of Labor's permission to keep managing money in the $8 trillion private pension market. At the same time, there's a cloud over the J.P. Morgan unit where pensions are managed: The SEC is well along in an investigation into conflicts of interest in the bank's wealth-management unit, whose products include individual retirement accounts.

That puts the bank in a sticky position - arguing that a criminal conviction shouldn't keep it from managing Americans' retirement savings, while the SEC is investigating possible wrongdoing in the same division that handles such business.

"When a bank has enforcement action after enforcement action, it becomes hard to argue that it won't happen again," says Urska Velikonja, an assistant law professor at Emory University whose research focuses on securities law.

J.P. Morgan spokesman Darin Oduyoye declined to comment "on Bloomberg speculation over future events."

The May 20 guilty pleas by America's biggest bank and four others - Citigroup, Barclays, Royal Bank of Scotland and UBS - required each to apply for regulatory exemptions from the SEC, as well as from the Labor Department, to carry on business as usual. The SEC issued the necessary approvals for the banks, but Democrats on Capitol Hill, as well as on the SEC Commission, have criticized rubber-stamping of waiver requests.

EXEMPTION NEEDED

Bank of America lost its ability late last year to issue certain securities without first seeking SEC permission. Credit Suisse is operating its $2 billion pension business under a temporary, one-year waiver while the Labor Department conducts an extensive review of whether to grant the Swiss bank's request for permanent relief.

The stakes are higher for J.P. Morgan Asset Management, the quickly growing business unit that includes mutual funds, private wealth management and some trusts. Its AUM included $319 billion in U.S. pension funds at the end of 2014, according to Pensions & Investments.

On the day last week when JPMorgan pleaded guilty to antitrust violations for manipulating currency rates, the bank applied to the Labor Department for an exemption to continue managing pensions as a Qualified Professional Asset Manager.

Banks rely on their QPAM status to carry out key transactions for pension clients, and a plea by any bank affiliate anywhere in the world triggers the need for it to apply for an exemption to maintain that business. J.P. Morgan needs to secure the waiver before it is sentenced.

ONGOING INVESTIGATION

The Labor Department has taken several months or more, in most cases, to carry out similar reviews. Michael Trupo, a Labor Department spokesman, declined to comment.

The May 20 application came just two weeks after JPMorgan disclosed in a regulatory filing that its wealth-management unit, part of the Asset Management division, is under investigation by the SEC, other government authorities and a self-regulatory organization. The unit was being probed for the sale and use of its own mutual funds and other proprietary product, the bank said.

The investigation is focused on whether J.P. Morgan employees have been putting customer money into the bank's own funds and other products, such as structured notes and hedge funds - not because they are necessarily the best choices for clients, but because those options generate fees for J.P. Morgan, according to people familiar with the matter.

As part of that probe, bank executives have been deposed and thousands of pages of internal documents subpoenaed, Bloomberg reported in March, citing people familiar with the situation. The Office of the Comptroller of the Currency, a primary banking regulator, is assisting the SEC in its investigation, added a person familiar with the matter.

The SEC's investigation into J.P. Morgan's money-management practices has been under way for at least two years, people familiar with the probe have said. Companies often disclose such investigations when they become material for shareholders.

That raises the possibility that the SEC and the other government authorities will reach a conclusion about potential wrongdoing inside the asset-management unit, as the Labor Department continues to review the bank's waiver for activities by the same group.

J.P. Morgan faces another potential hurdle at the SEC. Its commissioners last week approved issuing the necessary waivers for JPMorgan and the four other banks, agreeing that their felony records shouldn't stop them from managing mutual-fund money, among other things.

Any civil enforcement action from the SEC that includes injunctions or cease-and-desist orders - as many do - would force the bank to appeal for a fresh round of some of the same SEC waivers it has just been granted.

The SEC's commissioners approved the waivers, with Chairwoman Mary Jo White casting the deciding vote on some.

Commissioner Kara Stein voted against several, issuing a scathing dissent on May 21: "Allowing these institutions to continue business as usual, after multiple and serious regulatory and criminal violations, poses risks to investors and the American public that are being ignored. It is not sufficient to look at each waiver ... in a vacuum."

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