SEC Reportedly Subpoenas JPMorgan on Bear Stearns Double-Dipping

Back in January Teri Buhl reported here at The Atlantic that former Bear Stearns executives had been accused of cheating clients out of billions of dollars through a double-dipping scheme involving bad mortgages. The Securities and Exchange Commission is reportedly subpoenaing JPMorgan (where Bear now effectively resides) to obtain records connected to this accusation. It appears that Bear isn't the only one accused of such a scheme. Credit Suisse is also reportedly being investigated for doing something similar.

Here's an explanation of what the SEC is reportedly looking for, via Kerri Panchuk at HousingWire:

The crux of both investigations is a deliberate probe to see if Credit Suisse -- and Bear Stearns, which was acquired by JPMorgan three years ago -- demanded originators reimburse them for selling bad mortgage debt and then, in turn, failed to meet their own contractual obligations to reimburse other parties.

This is exactly the allegation reported here, back in January. If the SEC announces a formal investigation, expect to see other authorities follow. As I wrote, this could be huge if the SEC finds the evidence it's looking for, and unless documentation has been destroyed, then that evidence should be pretty easy to find..

Read the full story at Housing Wire.

Presented by

Daniel Indiviglio was an associate editor at The Atlantic from 2009 through 2011. He is now the Washington, D.C.-based columnist for Reuters Breakingviews. He is also a 2011 Robert Novak Journalism Fellow through the Phillips Foundation. More

Indiviglio has also written for Forbes. Prior to becoming a journalist, he spent several years working as an investment banker and a consultant.

Why Is Google Making Human Skin?

Hidden away on Google’s campus, doctors at a world-class life sciences lab are trying to change the way people think about their health.

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register with Disqus.

Please note that The Atlantic's account system is separate from our commenting system. To log in or register with The Atlantic, use the Sign In button at the top of every page.

blog comments powered by Disqus

Videos

Why Is Google Making Skin?

Hidden away on Google’s campus, doctors are changing the way people think about health.

Video

How to Build a Tornado

A Canadian inventor believes his tornado machine could solve the world's energy crisis.

Video

A New York City Minute, Frozen in Time

This short film takes you on a whirling tour of the Big Apple

Video

What Happened to the Milky Way?

Light pollution has taken away our ability to see the stars. Can we save the night sky?

Video

The Pentagon's $1.5 Trillion Mistake

The F-35 fighter jet was supposed to do everything. Instead, it can barely do anything.

More in Business

Just In