Criminal Charges and Civil Inquiries for JP Morgan? No surprise…

Banks behaving badly (now referred to as BBB) should be the title of an on-going saga with the nation’s largest financial institutions. It’s also the reason why harsh penalties and strict regulations are needed to keep Wall Street from running amok.

JP Morgan Chase In the latest episode of ‘BBB’, J.P. Morgan Chase, the nation’s largest bank based on its asset size, is back in the news again. A regulatory filing released yesterday reveals that J.P. Morgan Chase is the subject of a criminal and civil investigation related to mortgage-backed securities. Once again, the banking institution is facing a criminal probe over its role in a mortgage-related issue; the U.S. Attorney’s Office for the Eastern District of California is investigating the firm’s (and its subsidiaries) securitisation of mortgages. At issue is  whether or not the firm knowingly sold bad mortgage-backed securities to investors prior to the financial crisis that helped collapse the housing market and the nation’s economy.

A little over a week ago, the Federal Energy Regulatory Commission (FERC) — the independent agency responsible for  assisting consumers in “obtaining reliable, efficient and sustainable energy services at a reasonable cost through appropriate regulatory and market means” — released a notice on the allegations against a J.P. Morgan Chase affiliate. JPMC has been accused by  federal energy regulators, after a investigation that began approximately one year ago, of using ”eight manipulative bidding strategies” to garner what the regulators deem to be “excessive payments” from electricity markets. In a nutshell, that’s market manipulation. It’s fraudulent. The FERC ”notice of alleged violations” disclosures preceded the settlement between JPMC and FERC, which is a $410 million fine to settle the charges.

This incident is yet another in a long string of highly questionable activities; J.P. Morgan Chase is hardly unfamiliar with repeated bad behaviour. Whether it’s LIBOR scandals and rogue traders, or wrongful foreclosures on homeowners the bank ends up denying   wrongful actions and paying relatively meager fines.

Just what will it take to get them to behave?



  1. […] which banks are going to be affected in the long run. However, as the financial experts believe, JPMorgan Chase, Wells Fargo and State Street Corp. are the three banks which will be impacted the most. However, […]

  2. […] But have no fear; we’re not in for another bubble-bursting scenario, at least according to analysts at JP Morgan Chase. […]