The United States Department of Justice was prepared to announce today that it had reached agreement with JP Morgan Chase (JPM), America’s largest bank, on a settlement to pay restitution for the huge financial institution’s questionable mortgage practices just prior to the banking and financial crisis that nearly overwhelmed that industry about four years ago.
In the agreement reached between the bank and the government agency, JP Morgan Chase has indicated a willingness to pay a whopping thirteen billion dollars in fines. Four billion dollars of that money will go to struggling homeowners who are in desperate need of financial assistance.
In order to properly disperse the funds, JP Morgan Chase will have to hire an independent monitor to oversee distribution of the money to make absolutely certain it reaches those who need it.
The settlement has been arrived at after many months of intense negotiation between the federal agency and the bank and is being levied against the huge company because it illegally and unethically sold troubled mortgage securities to investors who then lost millions and millions of dollars.
The bank sold the securities knowing full well that they represented poor risks to those who purchased them. And now, it is paying for what it did with the biggest fine ever charged to a company in American history.