Siena prosecutors have requested that JPMorgan stand trial for obstructing regulators as part of a wider probe into Banca Monte dei Paschi di Siena SpA’s purchase of Banca Antonveneta SpA, according to four people with knowledge of the matter.
Bloomberg reports that prosecutors allege JPMorgan withheld information from regulators about a $1.3bn financing the bank arranged for Monte Paschi’s takeover of Antonveneta in 2008, said the people, who asked not to be identified because the request is not public.
JPMorgan failed to oversee employees properly, according to the indictment request, the people said. A judge will review the request at a date that’s to be determined. Prosecutors also are seeking indictments against former Monte Paschi managers for obstructing regulators, as well as market manipulation and falsifying filings, the people said.
JPMorgan should have informed the Bank of Italy that Monte Paschi had guaranteed it against losing money on the bond sale, the central bank said in an 19th April letter to prosecutors. The Bank of Italy said it may have withheld approval for the deal had it known about the indemnity.
'No claim was ever made under the indemnity, which only existed for a matter of days, including either for the benefit of JPMorgan or any of its employees', the U.S. bank said Tuesday in an e-mailed statement. 'We believe that JPMorgan and its employees acted correctly at all times. We will defend this action vigorously'.
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