JPMorgan Chase & Co. (NYSE:JPM) is the target of even more investigations by authorities in the U.S. These new investigations have nothing to do with the London Whale trading incident, although that incident will reportedly be the subject of a meeting between bank executives and investigators next month, according to DealBook. Now investigators are looking into the bank’s connection with Bernie Madoff and some misstatements about mortgages that were in foreclosure.
At this point, there are eight different federal agencies probing the bank’s actions and practices. The Federal Bureau of Investigation and federal prosecutors are also trying to determine if there was any wrongdoing on the part of the bank in connection with any of the investigations.
DealBook reports now that the new investigations focus on determining just how much the bank knew about what admitted fraudster Bernie Madoff was doing while he was running his Ponzi scheme. They want to determine whether the bank failed to inform them about suspicious concerning Madoff.
Prosecutors believe JPMorgan Chase & Co. (NYSE:JPM) may have been in violation of a federal law requiring banks to tell officials about any transactions that appear to be suspicious. Madoff’s scheme was uncovered in 2008 when he ran out of cash to meet his customers’ redemption requests. He was sentenced to 150 years in prison. The trustee who was put in charge of liquidating Madoff’s company said JPMorgan Chase and other banks didn’t heed numerous warning signs about what Madoff was doing. The banks have denied the allegations.
In the other new investigators, authorities are reportedly said to believe that JPMorgan Chase & Co. (NYSE:JPM) “misstated” how it could have caused harm to over 5,000 people whose homes were in foreclosure. DealBook’s source said the Office of the Comptroller of the Currency will likely collect a payment from the bank to correct the “flawed” loan review.
