The government’s legal pursuit of JPMorgan strikes many people on Wall Street as unfair.
The New York Times reports that the Justice Department, other regulators and the bank are trying to negotiate a settlement over allegations of mortgage abuses.
To put the cases behind it, JPMorgan might end up paying more than $11bn in fines and relief to homeowners, according to people briefed on the negotiations.
'There’s a lot of value to regulators and officials to show they’re really punishing people', Alan D. Schwartz, who was chief executive of Bear Stearns when JPMorgan took the firm over in 2008, said in an interview on CNBC on Friday. 'And I think it’s overdone', he added.
The portrayal of JPMorgan as the victim goes back to the days of the financial crisis, when the bank bought Bear Stearns and the remains of Washington Mutual, a large savings and loan that was crippled with mortgage problems.
Those two former institutions appear to have committed most of the missteps that are at the heart of the settlement talks. Yet JPMorgan, which largely sidestepped the subprime debacle, is being held to account for troubles not of its own doing.
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