Bernie Madoff Haunts JPMorgan to the Tune of $2B
Bernie Madoff is not done haunting JPMorgan Chase (NYSE:JPM), the bank he used while orchestrating the largest Ponzi scheme in history. On Thursday, The New York Times reported that federal authorities could be narrowing in on an approximately $2 billion settlement related to the bank’s alleged neglect to investigate suspicious activity related to Madoff while he was a customer, as well as other charges related to the bank’s money-laundering controls.
Formerly a non-executive chairman of the Nasdaq exchange, Madoff pleaded guilty to 11 accounts of felony financial fraud in 2009 and is currently serving a 150-year sentence. All told, the amount missing from client accounts, including fabricated gains, was nearly $65 billion, with actual losses to investors of about $18 billion.
Madoff has been behind bars for about four years now, and the magnitude of his fraud is still making waves. In April, Reuters reported that the Office of the Comptroller of the Currency was engaging JPMorgan over its involvement with Madoff over the years and was considering filing a cease-and-desist order. The OCC’s gripe with the bank is a result of the fact that it failed to perform due diligence on Madoff and detect or report suspicious activity.