JPMorgan Reaches $13 Billion Deal with Justice Department - FOX 10 News | myfoxphoenix.com

JPMorgan Reaches $13 Billion Deal with Justice Department

Posted: Updated:
By FOX NEWS -

JPMorgan Chase and the U.S. Department of Justice have tentatively agreed to a massive $13 billion settlement of certain federal civil probes into alleged misleading and fraudulent sales of mortgage-backed securities by both the bank itself and Bear Stearns, which JPMorgan acquired during the height of the financial crisis, sources close to the matter say.

The settlement as of late Saturday was still preliminary and was reached after weeks of rancorous negotiations, in which bank officials vehemently argued it should be given a break by the federal government since it acquired Bear Stearns and Washington Mutual to help rescue these insolvent companies in 2008.

The nation's biggest bank by assets in this tentative deal has settled just civil probes by the attorney general for California over the bank's sale of its own mortgage-backed securities to Fannie Mae and Freddie Mac from 2005 to 2007, as well as the New York attorney general's probe of Bear Stearns' sale of MBSs to these two companies. The bank still faces criminal probes by the attorney general for California.

The settlement was reached with the U.S. Department of Justice, the California attorney general, the New York attorney-general and the Federal Housing Finance Agency; the Pennsylvania attorney general is still probing Washington Mutual mortgage-backed securities sales to Fannie and Freddie, but that probe has largely been inactive of late, bank sources say.

The bank was still negotiating whether to admit to wrongdoing as part of the deal.

The $13 billion settlement is $2 billion more than the sum previously reported, which initially called for the bank to pay $7 billion in cash and give $4 billion in mortgage relief.

The $13 billion includes $4 billion to settle claims by the Federal Housing Finance Agency, $4 billion in mortgage relief and $5 billion in fines.

The deal was first struck in a phone call late on Friday night between bank chief executive Jamie Dimon, Steve Cutler, the bank’s top counsel, and Eric Holder, U.S. attorney-general, and Tony West, his top deputy, sources say. Mr. Dimon and Mr. Cutler fought to get a deal that voids any potential criminal prosecution, but agreed to a tentative deal that leaves that issue unresolved.

Officials for JPMorgan and the Dept. of Justice declined comment.

In its latest quarterly earnings, JPMorgan booked a $9.2 billion litigation charge related to the probes. JPMorgan also disclosed a huge $23 billion in litigation reserves. It made about $20 billion net profit in all of 2012. JPMorgan Chase has spent $22 billion since 2008 on an estimated 18 federal, state and overseas probes.

  • Your MoneyMore>>

  • Maryland casino to interview workers from closing Atlantic City casinos

    Md. casino eyes workers from closing Atlantic City casinos

    Friday, July 25 2014 4:32 PM EDT2014-07-25 20:32:23 GMT
    AP photoAP photo
    A Maryland casino is looking to hire some of the soon-to-be-jobless Atlantic City casino workers. Maryland Live! is holding job fairs next week at the Sheraton hotel across from the Atlantic City Convention Center. The Hanover, Maryland casino held a similar recruitment effort in January when The Atlantic Club shut down.
    A Maryland casino is looking to hire some of the soon-to-be-jobless Atlantic City casino workers. Maryland Live! is holding job fairs next week at the Sheraton hotel across from the Atlantic City Convention Center. The Hanover, Maryland casino held a similar recruitment effort in January when The Atlantic Club shut down.
  • Dunkin' Donuts cashiers will try to 'upsell' you in the afternoon

    Dunkin' Donuts cashiers will try to 'upsell' you in the afternoon

    Friday, July 25 2014 5:54 AM EDT2014-07-25 09:54:31 GMT
    If an iced coffee from Dunkin' Donuts is part of your afternoon routine, expect a nudge to buy a cookie or doughnut you didn't plan on. Dunkin' Brands CEO Nigel Travis said in a phone interview Thursday that the company is pushing to get its cashiers to "upsell" to afternoon customers. It's part of an effort to increase sales after stores have emptied out after the morning rush.
    If an iced coffee from Dunkin' Donuts is part of your afternoon routine, expect a nudge to buy a cookie or doughnut you didn't plan on. Dunkin' Brands CEO Nigel Travis said in a phone interview Thursday that the company is pushing to get its cashiers to "upsell" to afternoon customers. It's part of an effort to increase sales after stores have emptied out after the morning rush.
  • iPad sales decline

    Are tablets already on their way out?

    Are tablets already on their way out?

    Friday, July 25 2014 5:50 AM EDT2014-07-25 09:50:16 GMT

    Four years ago, tablet owners starting raving about the market's newest piece of mobile technology. Last quarter, Apple iPad sales fell by 9 percent. Still, forecasting the death of the tablet seems premature and incorrect. More likely, all our devices are cross-breeding and evolving until all our calling, emailing, texting, messaging, Internetting, TV watching, all our communication happens on one mobile gadget.


    Four years ago, tablet owners starting raving about the market's newest piece of mobile technology. Last quarter, Apple iPad sales fell by 9 percent. Still, forecasting the death of the tablet seems premature and incorrect. More likely, all our devices are cross-breeding and evolving until all our calling, emailing, texting, messaging, Internetting, TV watching, all our communication happens on one mobile gadget.
Powered by WorldNow

KSAZ-TV & KUTP
511 W. Adams St.
Phoenix, AZ 85003

Phone: (602) 257-1234
Fax: (602) 262-0177

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | Terms of Service | Ad Choices