U.S. agency sues JPMorgan over mortgage securities

Tue Dec 18, 2012 12:06am IST

JPMorgan Chase & Co's international headquarters are seen on Park Avenue in New York July 13, 2012. REUTERS/Andrew Burton/Files

JPMorgan Chase & Co's international headquarters are seen on Park Avenue in New York July 13, 2012.

Credit: Reuters/Andrew Burton/Files

Related Topics

Stocks

   

REUTERS - The U.S. credit union regulator sued JPMorgan Securities and Bear Stearns & Co on Monday over alleged misconduct in the sale of $3.6 billion in mortgage securities to credit unions that collapsed because of losses from the securities.

The lawsuit by the National Credit Union Administration is its second against JPMorgan involving losses to credit unions. In June 2011 the agency sued it over securities in which JPMorgan was the underwriter and seller. That suit is still pending.

Bear Stearns, which JPMorgan (JPM.N) acquired in 2008, made misrepresentations in connection with the underwriting and subsequent sale of mortgage-backed securities to U.S. Central, Western Corporate, Southwest Corporate and Members United Corporate federal credit unions, the agency said.

The lawsuit, filed in federal court in Kansas, is the largest such lawsuit the regulator has filed to date.

A JPMorgan spokeswoman declined to comment.

In the past two years the agency has brought similar actions against Barclays Capital, Credit Suisse, Goldman Sachs, RBS Securities, UBS Securities, Wachovia and others.

Most of the cases are pending, but it has settled claims against Citigroup, Deutsche Bank Securities and HSBC for around $170 million.

The agency has been trying to recover losses related to the failure of five institutions that it seized in 2009 and 2010 after they ran into trouble due to the crumbling housing market.

(Reporting by Aruna Viswanatha; Editing by Phil Berlowitz)

FILED UNDER:

Religion and Politics

REUTERS SHOWCASE

Fund Raising

Fund Raising

Flipkart raises $700 million in fresh funding.   Full Article 

Reforms Push

Reforms Push

Modi may order insurance, coal reforms if vote delayed - officials.  Full Article 

Reuters Exclusive

Reuters Exclusive

India looks to sway Americans with nuclear power insurance plan  Full Article 

To Boost Growth

To Boost Growth

Crank up public spending to revive growth - chief economic adviser.   Full Article 

Bold Steps

Bold Steps

SpiceJet rescue plan marks bold bet on Indian aviation recovery.   Full Article 

New Airline

New Airline

Tata, Singapore Air venture Vistara to take off on Jan 9.  Full Article 

Online Sales

Online Sales

Knock knock. Who's there? Amazon's best-selling holiday author.  Full Article 

Hacking Attack

Hacking Attack

N.Korea says did not hack Sony, wants joint probe with U.S.  Full Article 

Reuters Poll

Reuters Poll

BSE Sensex to hit 32,980 by December 2015  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage