JPMorgan to pay $614 mln in U.S. mortgage fraud case

JPMorgan to pay $614 mln in U.S. mortgage fraud case | Reuters

"JPMorgan Chase & Co
settled the latest in a string of legal claims on Tuesday when
it agreed to pay $614 million to the U.S. government and
admitted that it defrauded federal agencies by underwriting
sub-standard mortgage loans.

JPMorgan, the largest U.S. bank by assets, said as part of
the settlement that for more than a decade it approved thousands
of insured loans that were not eligible for insurance by the
Federal Housing Administration or the Department of Veterans
Affairs, according to court papers.

As a consequence, "both the FHA and the VA incurred
substantial losses when unqualified loans failed and caused the
FHA and VA to cover the associated losses," the U.S. Justice
Department said in a statement.

JPMorgan is one of several banks that has faced similar
allegations. Citigroup Inc and Deutsche Bank AG
have also reached settlements, while the Justice Department is
seeking $2.1 billion in penalties from Bank of America Corp
after a jury found the bank liable for fraud over
mortgages sold by its Countrywide unit.

Last year, JPMorgan agreed to about $20 billion in
settlements in its drive to clear up legal claims. The deals
covered claims over other mortgage issues, as well as
derivatives and power trading."