Share

JPMorgan to be fined over Lehman demise

A US regulator is set to penalise JPMorgan for actions linked to the demise of investment bank Lehman Brothers at the height of the financial crisis in 2008, the New York Times said, citing people briefed on the matter.

The Commodity Futures Trading Commission (CFTC) is expected this week to file a civil case against JPMorgan.

The bank is expected to settle the Lehman matter and pay a fine of about $20m, the paper said.

Such a move will be the first federal enforcement case resulting from Lehman’s downfall, the New York Times said.

The CFTC is expected to accuse JPMorgan of overextending credit to Lehman for two years leading up to its bankruptcy in 2008, according to the newspaper.

JPMorgan extended the credit using an inaccurate evaluation of Lehman’s worth, improperly counting Lehman’s customer money as belonging to the firm, the newspaper said, adding that firms are not allowed to use customer money to secure or extend credit under federal law.

The regulator is also set to accuse JPMorgan of withholding separate Lehman customer funds for nearly two weeks, rather than turning them over to authorities, the New York Times said.

JPMorgan declined to comment to the New York Times. The newspaper said the bank is expected to neither admit nor deny wrongdoing as part of the settlement.

JPMorgan and CFTC could not immediately be reached for comment by Reuters.
We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.99
-0.2%
Rand - Pound
24.14
-0.1%
Rand - Euro
20.64
-0.2%
Rand - Aus dollar
12.39
+0.2%
Rand - Yen
0.13
+0.5%
Platinum
911.88
-1.3%
Palladium
1,019.74
-4.3%
Gold
2,159.43
-0.1%
Silver
25.10
+0.2%
Brent Crude
86.89
+1.8%
Top 40
66,252
0.0%
All Share
72,431
0.0%
Resource 10
53,317
0.0%
Industrial 25
100,473
0.0%
Financial 15
16,622
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders