Boston, MA 01/07/2013 (wallstreetpr) – JPMorgan Chase & Co. (NYSE:JPM) is keen to get the legal changes it its facing behind it as fast as possible. The bank needs a positive image to win in the competitive financial industry. JPM is currently dealing with a lot of legal issues some of which relate to Ponzi ran by Bernard Madoff and mortgage loans.
According to a report carried by New York Times recently, JPMorgan Chase & Co. (NYSE:JPM) is close to a settlement in the Madoff case, for the bank could end up paying as much as $2 billion.
JPMorgan Chase & Co. (NYSE:JPM) found itself in unfamiliar grounds when it was accused of neglect, thereby allowing the illegal Ponzi scheme to continue. If the report about this settlement is true, $1 billion of the settlement amount will be paid to prosecutors in Manhattan, while the balance will go to Treasury Department. Sources also say that the government could come in to compensate the affected investors.
The Madoff saga
JPMorgan Chase & Co. (NYSE:JPM) is paying for the fraud committed by Madoff in an investment scheme that resulted in billions of losses for investors. It is believed that the bank was in a position to stop the fraud but instead allowed it to go on because it had an interest in the business. That illegal investment scheme earned Madoff 150 years in prison.
That JPMorgan Chase & Co. (NYSE:JPM) is paying an estimated $1 billion in relation to this saga comes as a big loss to the bank, however it is also a reprieve for the bank since it will have settled on of its decade-troubles.
Over the past 12 months JPMorgan Chase & Co. (NYSE:JPM) has paid around $20 billion in settlements of government probes. This includes the historic $13 billion single settlement over troubled mortgage-backed securities.
As concerns mortgage settlements, JPMorgan Chase & Co. (NYSE:JPM) is not alone. Other U.S. leading lenders such as Bank of America Corp (NYSE:BAC), Citigroup (NYSE:C) and Wells Fargo & Co (NYSE:WFC) have all paid for their dealings in the much-criticized mortgage loans sold to government-backed mortgage institutions Fannie Mae and Freddie Mac.