NEW YORK (CBSNewYork/AP) – JPMorgan Chase & Co., already beset by other costly legal woes, will pay more than $2.5 billion for ignoring obvious warning signs of Bernard Madoff’s massive Ponzi scheme, authorities said Tuesday.
The bank will pay $1.7 billion to settle criminal charges and a $350 million civil penalty for what the Treasury Department called “critical and widespread deficiencies” in its programs to prevent money laundering and other suspicious activity.
The trustee recovering assets for Madoff investors also announced that the bank will pay $543 million to settle other claims brought on behalf of fraud victims.
George Venizelos, head of the FBI’s New York office, said the company failed to carry out its legal obligations while Madoff “built his massive house of cards.”
“It took until after the arrest of Madoff, one of the worst crooks this office has ever seen, for J.P. Morgan to alert authorities to what the world already knew,” he said in a statement.