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Volume 7 - Number 15

July 18, 2014

JPMorgan Chief Seeks FHA Safe Harbor for Bank

JPMorgan Chase chief executive Jaime Dimon this week warned that the investment bank may rethink its FHA business without some type of safe harbor to shield it from potential future liabilities arising from the Financial Institutions Reform, Recovery and Enforcement Act and the False Claims Act. In February this year, JPMorgan agreed to pay $614 million to the federal government to settle allegations that it falsely certified poorly underwritten loans for FHA endorsement, causing massive losses to taxpayers in paid claims. Dimon lashed out at the government during a telephone briefing on the company’s second-quarter 2014 earnings report. He said JPMorgan lost a tremendous amount of money over what the government claimed was fraud but was in fact a “commercial dispute” between FHA and the bank. “We collected $600 million in insurance, the [government] disputed $200 million [alleging] it was fraud ...

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