JPMorgan in massive $13B tentative deal with Justice Dept.
JPMorgan Chase & Co. has reached a tentative resolution of all civil mortgage-bond related matters with the US Department of Justice, a person familiar with settlement negotiations said.
The settlement amount, which increased from $11 billion to $13 billion during negotiations last night, the person said, includes a $4 billion accord with the Federal Housing Finance Agency over the bank’s sale of mortgage-backed securities.
The pact, which isn’t yet final, doesn’t include a release of potential criminal liability, the person said, at the insistence of US Attorney General Eric Holder, who told JPMorgan Chairman Jamie Dimon during talks that such a release wouldn’t be forthcoming as part of any deal.
The proposed accord will probably require the bank to cooperate in criminal investigations of individuals tied to wrongdoing associated with the bank’s mortgage practices, said the person, who requested anonymity because the matter isn’t public. The deal also includes pending investigations by New York Attorney General Eric Schneiderman, the person said.
JPMorgan is the target of investigations in the US and abroad, including probes of its hiring practices in Asia. The bank has tapped $8 billion of $28 billion in reserves set aside since 2010 to cover its legal costs.
The outline of the tentative accord was reached last night during a telephone call between Holder, Dimon, JPMorgan General Counsel Stephen Cutler, and Associate U.S. Attorney General Tony West, said the person. The settlement’s statement of facts is still being negotiated.
Joe Evangelisti, a spokesman for the New York-based bank, wasn’t immediately available for comment. Brian Fallon, a spokesman for the Justice Department, declined to comment.
The case is Federal Housing Finance Agency v. JPMorgan Chase & Co., 11-06188, U.S. District Court Southern District of New York (Manhattan).
The settlement amount, which increased from $11 billion to $13 billion during negotiations last night, the person said, includes a $4 billion accord with the Federal Housing Finance Agency over the bank’s sale of mortgage-backed securities.
The pact, which isn’t yet final, doesn’t include a release of potential criminal liability, the person said, at the insistence of US Attorney General Eric Holder, who told JPMorgan Chairman Jamie Dimon during talks that such a release wouldn’t be forthcoming as part of any deal.
The proposed accord will probably require the bank to cooperate in criminal investigations of individuals tied to wrongdoing associated with the bank’s mortgage practices, said the person, who requested anonymity because the matter isn’t public. The deal also includes pending investigations by New York Attorney General Eric Schneiderman, the person said.
JPMorgan is the target of investigations in the US and abroad, including probes of its hiring practices in Asia. The bank has tapped $8 billion of $28 billion in reserves set aside since 2010 to cover its legal costs.
The outline of the tentative accord was reached last night during a telephone call between Holder, Dimon, JPMorgan General Counsel Stephen Cutler, and Associate U.S. Attorney General Tony West, said the person. The settlement’s statement of facts is still being negotiated.
Joe Evangelisti, a spokesman for the New York-based bank, wasn’t immediately available for comment. Brian Fallon, a spokesman for the Justice Department, declined to comment.
The case is Federal Housing Finance Agency v. JPMorgan Chase & Co., 11-06188, U.S. District Court Southern District of New York (Manhattan).
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