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.

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

Video

Photos of New York City, in Motion

A filmmaker animated hundreds of still photographs to create this Big Apple flip book

Video

The Absurd Psychology of Restaurant Menus

Would people eat healthier if celery was called "cool celery?"

Video

This Japanese Inn Has Been Open For 1,300 Years

It's one of the oldest family businesses in the world.

Video

What Happens Inside a Dying Mind?

Science cannot fully explain near-death experiences.

More in Business

Just In