UPDATE 1-Alabama county sues JP Morgan over sewer bond debt

* Alabama's Jefferson County sues JPMorgan

* County also sues two former bank officials

* County faces multibillion-dollar debt (Adds details, quotes)

BIRMINGHAM, Ala., Nov 13 (Reuters) - Alabama's Jefferson County sued JPMorgan Securities and JPMorgan Chase and Co (JPM.N) on Friday, alleging fraud related to the accumulation of its massive sewer bond debt, a senior county official said.

The county sued for compensatory and punitive damages over what it says were fraudulent transactions tied to interest rate and bond swaps earlier this decade as it sought to upgrade its sewer system.

"We are suing for fraud because they conspired to profit with interest rate swaps to the detriment of the county," said Assistant County Attorney Charles Wagner.

"They caused us to spend more money and enter in to ill-advised bond swaps for unjust enrichment of themselves. They suppressed material facts and fraudulently charged the money back to the county," he said.

JPMorgan said late on Friday the county's suit was "meritless."

"We believe the claims are meritless and intend to defend ourselves vigorously. Meanwhile, we continue to work to achieve a responsible restructuring of Jefferson County's financial affairs," said JPMorgan spokesman Joe Evangelisti in New York.

The county said it was also suing two former officials from JPMorgan as well as former Birmingham mayor Larry Langford, lobbyist Al LaPierre and investment banker William Blount.

The U.S. Securities and Exchange Commission earlier this month fined JPMorgan Securities and brought charges against two of its former officials over the transactions.

Jefferson County is struggling to stave off bankruptcy over a multibillion-dollar sewer debt accumulated in part because of the transactions.