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January 8, 2014

Investor Advocates Blast JPMorgan's Madoff Deal

JPMorgan Chase’s (JPM) roughly $2 billion deal to settle allegations the bank turned a blind eye to Bernard Madoff’s massive Ponzi scheme was harshly criticized Tuesday by investor advocates.

Much of the criticism targeted the government’s decision to allow JPMorgan, the largest U.S. bank by assets, to settle the allegations without either the firm or any individuals employed by the bank facing prosecution.

“’I’m deeply disappointed,’ said Ron Stein, president the Network for Investor Action & Protection, an investor advocacy group formed in the wake of the Madoff scandal. ‘The fact that no one is actually being prosecuted is an embarrassment to the Department of Justice.’

JPMorgan has agreed to pay a $1.7 billion fine to settle with the DOJ, and another $350 million to settle with the U.S. Office of the Comptroller of the Currency.

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“Separately, JPMorgan has also agreed to a $543 million settlement with the bankruptcy trustee overseeing restitution for Madoff’s victims.

“’JPMorgan Chase paying $1.7 billion for its criminal conduct helping Bernard Madoff’s Ponzi scheme is good, but still inadequate to stop what can only be called a one-bank crime spree. First, once again, not a single individual working for JP Morgan Chase has been held accountable. Banks do not commit crimes; bankers do,’ said said Dennis Kelleher, CEO of Better Markets, Inc., an independent nonprofit investor advocacy group.”

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Read full Fox Business article here

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