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JPMorgan, Credit Suisse Paying $417 Million in SEC Case

Nov. 19, 2012

JPMorgan Chase and Credit Suisse have agreed to pay a combined $417 million to settle federal civil charges that they sold risky mortgage bonds to investors that the banks knew could fail ahead of the 2008 financial crisis.

JP Morgan did not warn investors that homeowners were behind on their payments for the mortgages tied to the bonds, the Securities and Exchange Commission said Friday. And both banks failed to properly disclose practices that allowed them to profit while investors lost millions, the SEC said.

When the real estate bubble burst, home values plunged and millions of people defaulted on their mortgages and lost their homes. Investors who bought the securities backed by mortgages lost billions.

Money from the settlement will go to the investors, the SEC said.

Source: (C) 2012 Tulsa World

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