JPMorgan nears $2 billion settlement in a case tied to Madoff: NYT

Sun Jan 5, 2014 10:55pm EST

People walk inside JP Morgan headquarters in New York, October 25, 2013. REUTERS/Eduardo Munoz

People walk inside JP Morgan headquarters in New York, October 25, 2013.

Credit: Reuters/Eduardo Munoz

(Reuters) - JPMorgan Chase & Co is nearing a $2 billion settlement with federal authorities to resolve suspicions that the bank ignored signs of Bernard Madoff's Ponzi scheme, the New York Times reported, citing people briefed on the case.

The bank's civil and criminal settlements would also involve a deferred prosecution agreement, a criminal action that would suspend an indictment as long as the bank acknowledged the facts of the government's case and changed its behavior, the NY Times said.

As per the deal, JPMorgan will pay more than $1 billion to the prosecutors in Manhattan and the remainder to the Office of the Comptroller of the Currency (OCC) and a unit of the Treasury Department investigating breakdowns in the bank's safeguards against money laundering.

The government plans to use some of the payout for Madoff's victims, the paper said. (link.reuters.com/sur75v)

Madoff was convicted in 2009 of defrauding thousands of investors and is serving a 150-year prison sentence. JPMorgan has been accused of ignoring warning signs that Madoff's business was a fraud, often to win more fees and commissions for services they provided.

JPMorgan spokesman Joseph Evangelisti declined to comment on the New York Times report when contacted by Reuters.

Once reaching the Madoff settlements, the bank will have paid some $20 billion to resolve government investigations over the last 12 months, the newspaper said.

A government official told Reuters last month that the U.S. Treasury Department's Office of the Inspector General was examining whether JPMorgan interfered with the OCC's attempts to probe the bank's relationship with Madoff.

Madoff had also separately told U.S. authorities that JPMorgan - the bank he had used during his decades-long investment scam - had tried to stop the OCC from getting information about their relationship.

(Reporting by Sakthi Prasad in Bangalore; Editing by Supriya Kurane)

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Comments (4)
UScitizentoo wrote:
And another “esteemed” bank admits complicity – yet one more filthy nest of criminal activity after we turn over a financial world rock. Another “we will pay the fine and not admit wrongdoing and nobody will go to jail” deal with the revolving door justice department deal making machine. Add up the NSA criminality, the marriage of corporate control over congress (= fascism) , and you have a US government corrupt to the core. Vote to clean up this country by starting with the trash called congress – vote every representative or senator out with the notable exception of those trying to clean up. Or abandon your country and your children to a continuing corrupt US government.

Jan 06, 2014 12:57am EST  --  Report as abuse
kimsarah wrote:
Let’s hope the judge rejects the settlement.
And if it must be approved, direct the money to the state of Louisiana so it can ease up on its incarceration quotas.

Jan 06, 2014 1:04am EST  --  Report as abuse
SmartThinking wrote:
ANYBODY but a D or an R in every election from now on. State, local, national, it doesn’t matter. Don’t tell me there’s no alternative – Libertarians, Greens, Constitution, hell who says you have to choose a party anyway?? Vote independent if you must but the point is that Democrats and Republicans are NOT two different parties, they are ONE party – the 1% party, owned and operated by same.

Do you want to live in a free country with the right to privacy? Then there’s no time to quibble – get the DnR Party out of office ASAP, end corporate person-hood, withdraw the military back home to defend these shores and JUST SAY NO TO EMPIRE. It ain’t that hard a choice.

Jan 06, 2014 1:54am EST  --  Report as abuse
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