In a criminal investigation, JPMorgan Chase is facing action from federal authorities who suspect that the bank turned a blind eye to Madoff’s Ponzi scheme. That’s yet another headache in a week of migraines for America’s largest bank; last Friday JPMorgan Chase reached a tentative $13 billion settlement with federal prosecutors for its alleged manipulation of mortgage securities, which helped trigger the Great Recession. There may be more pain to come as the megabank faces litigation on a number of fronts.
And JPMorgan Chase is not alone – it is one of several banks being investigated by the government for mortgage fraud. While many headlines in the financial press accuse the government of conducting a witch hunt, Pulitzer Prize-winning New York Times columnist Gretchen Morgenson offers a different perspective: “If the Justice Department were being tough on Wall Street they would be talking about bringing criminal cases against individuals who helped to perpetrate this immense crisis.” she said. Morgenson adds that the investigations into JPMorgan Chase show that it and many other financial institutions are still ‘too big to fail,’ which means taxpayers could once again be forced to bail them out.
A full transcript of the discussion is available here.
[Via Bill Moyers]