NEW YORK, (Reuters) – JPMorgan Chase & Co agreed to pay $2.6 billion to the U.S. government and Bernard Madoff victims to settle allegations that the bank failed to tell authorities about its suspicions of fraud at Madoff’s fund.
Even as the bank cut its exposure to Madoff’s fund to minimize its losses it what ended up being a $17.3 billion Ponzi scheme, JPMorgan never shared its doubts with U.S. authorities, government prosecutors said.
“The bank connected the dots when it mattered to its own profit but was not so diligent when it came to its legal obligations,” Manhattan U.S. Attorney Preet Bharara said at a press conference.
“In part because of that failure, for decades, Bernie Madoff was able to launder billions of dollars in Ponzi proceeds essentially through a single set of accounts at JPMorgan,” Bharara added. The bank’s $1.7 billion settlement with the Department of Justice, part of the larger deal announced Tuesday, is the largest forfeiture a bank has ever had to pay to resolve anti-money laundering violations.
