JPMorgan has been ordered to pay millions of dollars in damages to one of the richest men in the world.
The bank was ordered to pay $42.5 million to billionaire Leonard Blavatnik, according to an Associated Press report. Blavatnik, who ranks 44th on Forbes’ list of billionaires, sued JPMorgan over a tanked investment in mortgage-backed securities.
The New York State Supreme Court ruled Monday that because JPMorgan had exceeded a 20% cap for mortgage-backed securities in Blavatnik’s CMMF fund, the bank had breached its contract with the billionaire.
Blavatnik had initially sought more than $100 million in damages for the soured deal, claiming that JPMorgan had mismanaged his funds. He also claimed that the bank had acted negligently in its handling of his money. However, New York State Supreme Court Justice Melvin Schweitzer rejected that claim, ruling that the bank had acted “reasonably, in light of the information that was available to it at the time.”
The bank’s woes are compounded by an ongoing criminal investigation. According to a Bloomberg report, the Department of Justice is probing the practices behind JPMorgan Chase’s sales of mortgage-backed bonds.In May, the DOJ issued a preliminary finding that Chase broke civil laws in the sale of securities tied to subprime and Alt-A loans, Bloomberg reported.