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New York's AG has filed a civil complaint against JPMorgan Chase (JPM), alleging widespread...
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Monday, October 1, 2012, 6:11 PM ETNew York's AG has filed a civil complaint against JPMorgan Chase (JPM), alleging widespread fraud in the sale of mortgage-backed securities in the run-up to the financial crisis. The suit relates to billions of dollars of subprime securities issued by Bear Stearns' before its takeover by JPM, and is the first brought under the authority of a law enforcement group formed by President Obama in January to pursue alleged wrongdoing during the financial crisis. More cases are expected to follow. Shares -0.8% AH.
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Or the acquirer will ask for blanket immunity from all civil and criminal charges due to malfeasance from prior management.
Notice this was a civil suit?
Now you can say you learned something today.
I disagree. And there was more than pressure, there was coercion, even threats. There were implications during interviews to this effect at the time specifically with BAC executives. I was also skeptical because, as you point out, the required shareholder fiduciary responsibility, & after all, this is America. Then NY sued BAC for violating its shareholder fiduciary responsibility regarding the acquisition of Merrill. BAC executives leaked actual memos & emails from Treasury that frankly turned my stomach. And magically, the leaked memos stopped & the law suit was quickly settled.
Now that doesn't speak to JPM & any coercion of Dimon regarding Bear. And Diamon hasn't said, but my point is its very possible as it clearly happened regarding Merrill.
All said, on the verge of another recession this lawsuit is another distraction. Government bails out banks, then sues them just as they are getting their footing, its nuts! Banks are not the 'evil empire', they need to get back to business, the country desperately needs a strong banking system.
BAC bought ML for a lot more than $2 a share. Go check your facts.
gh is right.........this is a distraction and the Fed is in the middle of it.
And banks are leaned on as standard practice to absorb failing banks. It has been the Feds standard approach as they know nothing about running a bank.
Its not a conspiracy, usually its the FDIC that negotiates troubled assets deals. But in the crisis the Fed & Treasury were also involved. It got ugly at BAC because they tried to back out of the Merrill deal, Why? Because of shareholder fiduciary responsibility! What they were later sued for! At the time Merrill may have been worthless. The threatening memos were published after NY decided to pursue a shareholder fiduciary civil suit regarding Merrill & it wasn't, as you say; "laughable".
An example of what I guess you think is a conspiracy is the FDIC funded the absorption of a Florida thrift AmTrust into NYB in the 1st half of 2010. It was not the 2 banks, the FDIC orchestrated the deal, & agreed to a government backed loss-sharing arrangement. This happened often with government involvement, but the message was; you better not back out! And so would you now expect the government to sue NYB over MBS issues at AmTrust?
This law suit is ridiculous, & political for Dimon's critical comments! I stand by my comment, The JPM/Bear could have been, probably was a similar deal.
You cannot even get public information right which gives away how much you are just guessing on everything. The price was around $29 per share. You are only off by 15X.
You are in over your head in these issues.
Any more logic to drop on us?
Bundle enough money for the right people and you not only stay out jail, but you summer in the Hamptons.
Best post I've read in a while!!
I've read or heard on Bloomberg/CNBC some mushy reason why Holder's AG office can't pursue Corzine. All said MF Global just screwed a bunch of mid-west, & southern farmers out of their $1.2 billion hedge money & nobody cares including the media! I guess these now-poor farmers will learn to support the correct candidates
he was perhaps the only one smart enough not to buy what he was selling. all i can say is if the booze is poisoned, look at the guy who wasn't drinking.
but shirley the assets of bear are still reachable? just because dimon was forced to buy them, that doesn't mean that killers on their staff get to walk. they'll have their lawyers work out a reach around. it's part of the price of being a modern robber baron, isn't it? at least he doesn't toss orphans a nickle like that old guy did.
What assets left from Bear would that be? I'm reasonably certain after losses were written down & legal fees paid there wasn't much left. I'm sure Dimon would have gladly backed out of the acquisition. But, as I recall wasn't given the option by the Fed & Treasury. Coercion was the name of the game in those days.
All said, even the lefty commentators on CNBC this morning seem to believe this law suit is a bad idea. You know it might be a good idea if the banks were encouraged to start lending again instead of dealing with this nonsense.
See my prior post. You might learn something.
And if the government has names of people who broke the law then they would file a criminal case against them directly.
This is babysitting.