Criminal Citation, $2 Billion Penalty for JPMorgan Chase In Madoff Case


JPMorgan Chase and federal authorities are nearing settlements over the bank's ties to Bernard Madoff, agreeing to tentative deals that would involve $2 billion in penalties and a rare criminal action. The government will use a sizable portion of the money to compensate Madoff's victims, reports the New York Times. The settlements, which are coming together on the anniversary of Madoff's arrest five years ago, would fault the bank for turning a blind eye to his huge Ponzi scheme.

A settlement with federal prosecutors in Manhattan would include a deferred-prosecution agreement and more than $1 billion in penalties to resolve the criminal case. The rest of the fines would be imposed by federal regulators investigating broader gaps in the bank's money-laundering safeguards. The agreement to deferred prosecution would also list the bank's criminal violations in a court filing but stop short of an indictment if JPMorgan pays the penalties and acknowledges the facts of the government's case. Prosecutors discussed the idea of extracting a guilty plea from JPMorgan, but chose the steep fine and deferred-prosecution agreement.

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