JPMorgan Faces Lawsuit Over Madoff Fraud

JPMorgan Chase (JPM), which for 20 years was the primary bank of convicted financial manager Bernard Madoff, is taking some heat from a court-appointed trustee representing victims of Madoff's multibillion-dollar Ponzi scheme. In a lawsuit filed Thursday, trustee Irving Picard alleges that the investment bank failed to act on suspicions about Madoff's scheme and instead collected fees and profits on the purported investments.

Picard is seeking $6.5 billion from JPMorgan, including at least $1 billion in returned fees and profits and $5.4 billion in damages, the Associated Press reported. The allegations echo those that Picard made last week, when he sued Swiss bank UBS (UBS) for $2 billion for its alleged role in the largest-ever U.S. Ponzi scheme.

JPMorgan Chase said it would contest the claim. "Contrary to the trustee's allegations, JPMorgan did not know about or in any way assist in the fraud orchestrated by Bernard Madoff," the company said in a statement Thursday. "Any suggestion that JPMorgan supported Madoff's fraud is utterly baseless and demonstrably false."

Madoff, who disclosed in late 2008 that his investment company was committing fraud, is serving a sentence of 150 years in federal prison.

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sumrbreze03

JP Morgan Chase should have a cell next to Bernie. Enough said.

December 14 2010 at 11:10 PM Report abuse rate up rate down Reply
kmgb60

There we go again. Let's use the Liar, Liar, Pants on Fire defense.

Typical of Jamie Dimon and JPM. Let's play denial. But when you lunch and play golf with the Presidient of the USA, I guess you can get away with almost anything.

They certainly have done a wonderful job lying about their outrageous theft of Washington Mutual. Just ask their shareholders how much money they were screwed out of by Jamie Dimon and JPM.

December 14 2010 at 9:17 AM Report abuse rate up rate down Reply
crimson00king

Let them give tax breaks to the rich NOW ALL AMERICANS KNOW WHO THE GOP IS WORRIED ABOUT AND THAT IS THE RICH 1 percent of America. I just love it when the tan man Boehnor crys on cue for the rich. I believe Americans are wise to the GOP now and 2012 when the younger voters return to the polls THE GOP will be SENT PACKING. Enjoy it while it last fellows.

December 12 2010 at 10:36 PM Report abuse +1 rate up rate down Reply
the2431

Awww...Come On, it's rated AAA and everyone's buying it ! Trust me ! We can tax the rich and make it all back up, it's only right you know ! Of Course, Mr. Big does business with us, like all Big Guys do ! I pray for America !

December 02 2010 at 11:48 PM Report abuse +1 rate up rate down Reply
johnskii

J.P. Morgan Chase Bank doing some thing illegal??? C'mon no way! ;-)

December 02 2010 at 10:08 PM Report abuse +1 rate up rate down Reply