WASHINGTON -- JPMorgan chief executive Jamie Dimon met Thursday with Attorney General Eric Holder about an investigation into the company's handling of mortgage-backed securities in the run-up to the recession.
A person familiar with the matter said Dimon was at the department to meet with Holder. The person wasn't authorized to speak on the record about the matter and spoke on condition of anonymity.
An $11 billion national settlement is under review to resolve claims against JPMorgan (JPM), according to a government official familiar with ongoing negotiations among bank, federal and New York state officials.
As he walked into the Justice Department on Thursday, Dimon declined to answer when asked about the state of the discussions.
The Department of Justice is taking the lead on the settlement, which would include $7 billion in cash and $4 billion in consumer relief, said the official, who spoke on condition of anonymity because a settlement hasn't been reached, and the official wasn't authorized to discuss it publicly.
The government has continued investigating JPMorgan over mortgage-backed securities, which lost value after a bubble in the housing market burst and helped spur the financial crisis.
In January 2012, a task force of federal and state law enforcement officials was established to pursue wrongdoing with regard to mortgage securities.
In other cases, the Justice Department last month accused Bank of America (BAC) of civil fraud in failing to disclose risks and misleading investors in its sale of $850 million in mortgage bonds in 2008. The Securities and Exchange Commission filed a related lawsuit. The government estimates that investors lost more than $100 million on the deal. Bank of America is disputing the allegations.
JPMorgan came through the financial crisis in better shape than most of its rivals, and CEO Dimon had charmed lawmakers and commanded the attention of regulators in Washington.
A number of big banks, including JPMorgan, Goldman Sachs (GS) and Citigroup (C), previously have been accused of abuses in sales of securities linked to mortgages in the run-up to the crisis. Together they have paid hundreds of millions of dollars in penalties to settle civil charges brought by the SEC, which accused them of deceiving investors about the quality of the bonds they sold.
JPMorgan settled SEC charges in June 2011 by agreeing to pay $153.6 million and reached another such agreement for $296.9 million in November.