JP Morgan tentative agreement of $13 billions on settlement for faulty loans.

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In what looks to be a historical record settlement for bad mortgages, JP Morgan the largest bank in the US has reached a tentative agreement with the Justice Department agreeing to pay $13 billion in order to shelve allegations that accuse the bank of selling faulty mortgage securities which have in fact added to the already shaky financial status of the country.

This comes in the wake of the trend when mortgage securities were being sold off by Wall Street for many years. Banks, would often would pool off hundreds of mortgages and market the bundles as investments which was then traded off like stocks, loans had been issued to those who wanted to buy homes. These securities became useless when the housing market crashed, and investors had to bear huge losses.

JPMorgan Chase has been accused of misleading Fannie Mae and Freddie Mac about the quality of the mortgages it sold during the housing boom of the late-2000s and the consecutive deal supposedly reached no, a consequence of the very same case.

The bank’s has reportedly admitted to its wrongdoings and agreed to pay more than $1 billion in settlements with five regulatory agencies for what is known as its “London whale” trading debacle.

The deal would mean a few things. First it would probably take off much of the burden off the Government, which has been previously severely publicly criticized because of its struggle to hold Wall Street accountable for its problems. Secondly, it would in fact be a relatively fair deal for JP Morgan which like many other banks has faced the accusations of selling bad residential mortgages to investors.

The settlement is especially important because of the fact that most crusaders have been of the opinion that banks have been let off rather lightly till now, in spite of the Justice Department‘s endeavor to levy multimillion-dollar fines against banks like HSBC and Barclays which have ad charges against them.

In spite of the fact that both JPMorgan and the Justice Department decide to keep mum on the subject, insiders reveal that the bank is keen to wrap up the deal fast, especially because this has been going on for many months now. Following heated direct discussions a few weeks ago with the bank’s chief executive, Jamie Dimon, and Attorney General Eric H. Holder Jr. this conclusion was reached at it is to be believed.

It is of course clear that JPMorgan as a bank wants to wind up the many investigations that are being conducted on its working. As a result the bank has come to a conclusion that is perhaps more wise to pay up rather than having long winding conclusions that might draw up even more flak. While Mr. Dimon, called the fallout as “painful” for him and the company, it is perhaps a conclusion that he and his company can hardly avoid. In the end it is the US economy that one hopes, will emerge the winner in this!

Shah Peerally is an attorney licensed in California practicing immigration law and debt settlement. He has featured as an expert legal analyst for many TV networks such as NDTV, Times Now and Sitarree TV. Articles about Shah Peerally and his work have appeared on newspapers such as San Jose Mercury News, Oakland Tribune, US Fiji Times, Mauritius Le Quotidien, Movers & Shakers and other prominent international newspapers. His work has been commended by Congress women Nancy Pelosi and Barbara Lee.  He has a weekly radio show on KLOK 1170AM and frequently participates in legal clinics in churches, temples and mosques.

 

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Attorney Shah Peerally also deals in debt settlement. For more information call us on 510.742.5887 and visit us on www.YourDebtSettlementAttorney.com.

Information provided above is for educational purposes only.  One should not act or refrain to act solely based on the information provided.  You should consult an attorney to assess your case before proceeding.

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