CFTC To File Case Against JP Morgan
April 4, 2012 by UPI - United Press International, Inc.
NEW YORK, (UPI) — U.S. regulators are poised to file a case against JP Morgan Chase for its role in the collapse of Lehman Brothers in 2008, sources told The New York Times.
The sources said that the Commodity Futures Trading Commission is set to charge JP Morgan with using customer funds as collateral to extend credit to Lehman Brothers.
JP Morgan, in turn, will likely admit to no wrongdoing, but pay a fine of $20 million, the sources said.
It is unclear whether or not JP Morgan knew the funds belonged to customers, but it is at least a distinct possibility. According to regulators, the customer funds belonged to futures investors and it was held in a JP Morgan account, the Times said.
The collapse of Lehman Brothers remains the most prominent symbol of the financial crisis of 2008. Civil cases have been filed, but the CFTC’s action will be the first federal case to be filed concerning the investment firm’s bankruptcy.
JP Morgan declined to comment on the case, which will likely be settled without an admission by the bank of any wrongdoing.