Talks between JPMorgan Chase & Co. and the federal government over a possible $11bn settlement stalled last week
Talks between JPMorgan Chase & Co. and the federal government over a possible $11bn settlement stalled last week, according to the New York Post.
The nation’s largest bank and the government have been negotiating a settlement over the lender’s sale of mortgage-backed securities, although the talks eventually expanded to cover other issues. The talks have reached high-level players in both camps, with JPMorgan CEO Jamie Dimon meeting with Attorney General Eric Holder in recent weeks.
However, negotiations hit a snag this week when the government wouldn’t guarantee that the $11bn settlement would mark the end of federal scrutiny, the Post reported Friday.
The government is also demanding an admission of wrongdoing from the lender – a concession JPMorgan doesn’t want to give, as it could open the bank to further liability, according to the Post. If the talks collapse, the Department of Justice is likely to file a civil suit against the lender.
JPMorgan ended up with about 70% of the financial meltdown’s bad mortgage debt after it acquired the failing Bear Stearns and Washington Mutual. Between 2008 and 2012, the bank spent $17.7bn on litigation alone, and is currently facing more regulatory enforcement actions than any other U.S. bank, as well as at least seven separate Justice Department investigations.