Seeking Alpha

JPMorgan to take $850M charge in Madoff settlement

  • The total settlement - when fines from the OCC and payments to private litigants are added to the $1.7B headline number to the DOJ - is roughly $2.6B. The Bank of Dimon (JPM -1.1%) expects to add about $400M to its reserves to cover that for which it hadn't already reserved for.
  • As a result of the settlement payments being non-tax-deductible, JPMorgan expects the deal to cut Q4 income by about $850M. The bank will likely earn somewhere in the area of $30B this year. Off a bit today, the stock remains within cents of a 10-plus-year high.
  • SEC Form 8-K
  • Previous coverage
Comments (4)
  • pigeonguy
    , contributor
    Comments (100) | Send Message
     
    Can someone explain what did JPM do to facilitate Madoff's Ponzi scheme? Was it one individual in the bank, group of individuals or a systemic breakdown in the bank? I just don't know. Where is the penalty and punishment for the SEC which was told that Madoff was running a Ponzi scheme and then chose to ignore it?
    7 Jan, 03:40 PM Reply Like
  • idkmybffjill
    , contributor
    Comments (1557) | Send Message
     
    I think there were internal memo's where bank execs basically suspected it was a ponzi scheme and that his returns couldn't be real. But they kept facilitating his operations.
    7 Jan, 03:55 PM Reply Like
  • philipmax
    , contributor
    Comments (250) | Send Message
     
    And once again the Treasury pockets the bulk of the settlement!
    7 Jan, 04:16 PM Reply Like
  • idkmybffjill
    , contributor
    Comments (1557) | Send Message
     
    Gotta make those debt interest payments...
    7 Jan, 04:31 PM Reply Like
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