Bernie Madoff cost investors billions in his Ponzi scheme, and now his bank - JP Morgan Chase will also have to pay up for maintaining a client relationship with him. Following the conclusion of a trial held today in New York, JP Morgan will pay $2.6bn in relief to jilted Madoff investors and the government. This latest round of fines is in addition to the $13bn in fines the bank is paying out for mortgage misconduct and others totaling to almost $20bn. The bank has been socking away cash to cover both the payouts and legal expenses, although some critics say the judgements don't go far enough to keep banks from conducting these activities.
The complaint around the Madoff case focused on the client relationship the bank had with the convicted Ponzi schemer. Prosecutors said that the failure of bank executives to report what they admitted to be suspicious behavior to authorities constituted neglect.
"The bank connected the dots when it mattered to its own profit but was not so diligent when it came to its legal obligations," said New York Prosecutor Preet Bharara at a press conference.
Still, critics of the case note that no one from the bank has faced personal charges concerning this or any of the other cases settled by JP Morgan. They say that the lack of charges, tells bankers in effect that they can......................