Search Team

Search by Last Name
A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z

White Collar

JPMorgan strikes deal with the Justice Department

November 19, 2013

White Collar

JPMorgan strikes deal with the Justice Department

November 19, 2013

Back to Fish's Litigation Blog

 

Following on the heels of a multi-billion dollar settlement (as we previously wrote about) with the Federal Housing Finance Agency (“FHFA”), JPMorgan has struck a broader and larger $13 billion deal with the Justice Department to settle federal civil claims against the bank arising out of the 2008 mortgage-related financial crisis. 

This is despite the fact that a large amount of the bundling and sale of toxic securities was by Bean Stearns and Washington Mutual, who JPMorgan later acquired.  Nevertheless, the price tag for peace makes this the largest settlement ever with a single entity on the hook.  Don’t print those trivia cards just yet, though.  The Justice Department has clearly stated that it will pursue others for fraud related to the 2008 financial crisis.   It is also worth noting that this deal only resolves civil claims.  Despite some last minute haggling and a personal visit by Jamie Dimon to Eric Holder, JPMorgan was unable to get a non-prosecution agreement, and it is likely that government wants the bank to plead guilty to resolve criminal charges.

Because JPMorgan acknowledged, as part of the civil settlement, that its employees knowingly misrepresented that underwriting guidelines were being met, one key area to watch for will be the extent to which any future civil claims or criminal charges may include individuals.  The Justice Department’s announcement certainly leaves that door open, “the agreement . . . does not release individuals from civil charges, nor does it release JPMorgan or any individuals from potential criminal prosecution.”  It remains to be seen how this will play out, however, especially since criminal statutes of limitations are waning.

Related Tags

Civil Claims

Leave a Reply

Your email address will not be published. Required fields are marked *