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This week, JPMorgan Chase & Co. (NYSE: JPM) agreed to a tentative $13 billion settlement over a government investigation into faulty mortgage loans the company sold to investors.
What most investors don't realize is that the company has been involved in 10 other settlements in the last two and a half years. Here's a rundown of JPMorgan's bad behavior since 2011.
Ten JPM Settlements, But Few Admissions of Guilt
- April 2011, $56 million: JPMorgan was one of several banks sued in a class-action lawsuit that alleged the companies overcharged active military personnel and foreclosed on their families. JPMorgan paid $27 million in its settlement, turned over the keys to the homes that shouldn't have been foreclosed by their loan department, and reduced interest rates for military customers.
- June 2011, $153.6 million: JPMorgan settled with the U.S. Securities and Exchange Commission for failing to tell investors that a hedge fund helped select and ultimately bet against a collateralized debt obligation that the company sold. Customers lost significant sums in the rigged deal.
- July 2011, $229 million: JPMorgan settled a case that alleged the company rigged the bidding process of bonds in 31 states. The bank settled for $229 million and was not required to admit any crime.
- August 2011, $88.3 million: JPMorgan paid an $88.3 million civil penalty for allegedly violating economic sanctions by engaging in trade with individuals and companies with business ties to Iran, Cuba, Sudan, and Liberia.
- February 2012, $5.29 billion: JPMorgan was part of a $25 billion settlement against five mortgage service providers. The deal was forged with the Justice Department and the U.S. Department of Housing and Urban Development.
- February 2012, $110 million: JPMorgan was one of several banks that settled a suit claiming the companies processed deposit checks by size instead of by chronological order. By doing so, the companies were able to charge unwarranted overdraft fees on customers.
- March 2012, $150 million: JPMorgan settled with pension funds and investors over a faulty structured investment vehicle that collapsed during the 2008 financial crisis. The company paid $150 million and avoided having to admit guilt.
- November 2012, $296.9 million: JPMorgan was charged nearly $300 million for allegedly misleading investors about the quality of mortgages. The bank settled the charges and was able to avoid having to admit guilt.
- January 2013, Undisclosed: JPMorgan Chase was one of 10 banks that paid $8.5 billion to the Federal Reserve and the OCC on charges that the company allegedly engaged in "robo-signing" in the mortgage business.
- March 2013, $100 million: JPMorgan Chase refunded $546 million to former customers of MF Global Holdings. MF Global collapsed when former Chief Executive Officer Jon Corzine allegedly allocated billions in customer funds to attempt to pave over faulty bets on the stability of the European economy.
- July 2013, $410 million: JPMorgan was slapped with $410 million in fines by the Federal Electricity Regulatory Commission for allegedly manipulating bidding practices in the electricity markets.
For more on the JPM settlement of $13 billion – a record fine – read What the JPM Settlement Means for Wall Street.
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.