JPMorgan Chase and U.S. Justice Department Reach Tentative $13 Billion Settlement About Mortgage-Backed Securities. What Next?
Earlier this week, many news outlets reported the JPMorgan Chase bank and the U.S. Justice Department had tentatively agreed to a $13 billion settlement for alleged corporate wrongdoing with mortgage asset-backed securities the bank sliced, diced, re-bundled, and sold as derivatives and other financial products. A key part of this settlement isn't the huge cash amount, but that the criminal investigation continues and prosecution is a distinct possibility -- as it should be.
Just last month, the bank agreed to pay $1 billion to settle with the CFPB and other agencies about alleged wrongdoing with identity-theft protection services and collection services.
My questions are: after the current criminal investigation and settlement about mortgage asset-backed securities are concluded, what next about credit-card asset-backed securities by JPMorgan Chase? Will this be a another criminal investigation with jail time for more bank executives?
Some background for those unfamiliar:
- The SEC Places New Restrictions on Asset-Backed Securities (April 2010)
- J.P. Morgan Chase & Co. Issues $2.775 Billion in Credit Card Asset-Backed Notes (September 2009)
- Chase Bank USA Issues $1.5 Billion in Credit Card Asset-Backed Notes (June, 2009)
- Rating Action: Moody's places subordinate classes of Chase credit card receivables-backed securities on review for possible downgrade (April, 2009)