JPMorgan Chase reaches $2B settlement over foreclosure abuses
The nation’s largest bank, JPMorgan Chase, has agreed to pay borrowers some $2 billion in mortgage relief and direct cash payments in order to settle foreclosure abuse claims with regulators, the Wall Street Journal reported. The settlement calls for some $753 million in cash payments and $1.2 billion for “foreclosure prevention actions.”
The bank has said that it will book a $700 million pre-tax charge in the fourth quarter of 2012 to account for the cost of the settlement, which it will report on January 16. JPMorgan was one of 10 banks slapped with fines Monday, following a regulatory probe into abusive foreclosure practices in the aftermath of the financial and housing crisis.
The settlement comes on the heels of Bank of America’s $11.6 billion settlement with mortgage giant Fannie Mae and not long after Wells Fargo agreed to pay out $175 million in a discrimination case (BofA also paid the Justice Department $335 million in a discrimination in December 2011 and Morgan Stanley is currently facing similar discrimination charges from the ACLU). Last year, Wells Fargo, Bank of America, Ally Financial, JPMorgan Chase and Citigroup agreed to a $26 billion settlement with regulators over discriminatory and wrongful mortgage servicing practices. [WSJ] —Christopher Cameron