17:17 20 November 2013
JP Morgan is to pay for the price for misleading investors during the housing crisis to the tune of $13bn (£8bn). This is the largest settlement in history between the US government and a corporation.
JP Morgan boss Jamie Dimon said in a statement: “We are happy to have concluded this extensive agreement.” The bank said that although it did not violate US laws it admitted making “serious misrepresentations to the public.”
Homeowners who are affected by JP Morgan practices will receive about $4bn. According to chief financial officer Marianne Lake, this is targeted at “keeping people in their homes.”
Another $7bn will be used to settle federal and state civil claims that are related to misleading mortgage securities sold by the bank. Some investors who lost money in the process will also get a portion of the money. The US government will receive $2bn as a fine and will not be tax-deductible.
In a statement, Attorney General Eric Holder said: "The conduct uncovered in this investigation helped sow the seeds of the mortgage meltdown.”
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