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Biggest US bank to pay $13bn for role in GFC

by Staff Reporter7 minute read
The Adviser

The United States' biggest bank, JP Morgan, will pay over US$13 billion for its part in the collapse of the US economy, felt around the world during the GFC.

According to several media reports from the USA, JP Morgan has reached a tentative US$13.45 billion deal with the US Department of Justice in a settlement of a wide range of issues related to the sale of bad mortgages.

However, neither the bank nor the US Department of Justice have released a statement on the deal.

The deal will reportedly include US$9.3 billion in fines and US$4 billion in compensation.

According to Reuters, the deal comes after a criminal probe into the bank for activity in the lead up and during the GFC.

Investors said JP Morgan told them loans were better than they actually were, or the bank was negligent in accepting information from borrowers about their income and other matters at face value, instead of verifying it.

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