Not long after Bank of America (BofA)
came under fire
from three separate entities, one of which being the Department of
Justice (DOJ), both MetLife and JPMorgan Chase are finding themselves in
the DOJ’s crosshairs. There’s no historical record indicating that the
DOJ has gone after three large entities all at once, however; in the
case of BofA, the case was built over the course of a few years. Whether
or not the cases against JPMorgan Chase and MetLife are similar remains
to be seen.
In an
SEC filing,
it was revealed that MetLife received a subpoena back in May, which
reads “requiring production of documents relating to MetLife Bank’s
payment of certain foreclosure-related expenses to law firms and
business entities affiliated with law firms and relating to MetLife
Bank’s supervision of such payments, including expenses submitted to the
Federal National Mortgage Association, the Federal Home Loan Mortgage
Corp. and the U.S. Department of Housing & Urban Development (HUD)
for reimbursement. It is possible that various state or federal
regulatory and law enforcement authorities may seek monetary penalties
from MetLife Bank relating to foreclosure practices.”
MetLife may face substantial fines should the governmental probe find
anything. “It is possible that various state or federal regulatory and
law enforcement authorities may seek monetary penalties from MetLife
Bank relating to foreclosure practices,” the insurer said in the filing.
JPMorgan Chase is the third bank under investigation by the DOJ, for
charges of criminal practices related to sales of mortgage-backed bonds.
“It is unprecedented that the Department of Justice has seriously
considered criminal indictment of a major bank and I question whether it
truly is,” said Professor John Coffee, of Columbia Law School
to Bloomberg. “You can often bring dual investigations, civil and criminal, in order to maximize pressure for a global civil resolution.”
The indication is that the probes into JPMorgan Chase’s loans and
mortgage-backed securities are product of JPMorgan, not the ones
purchased from Bear Stearns Cos. and Washington Mutual back in 2008.
“The Department of Justice is likely to be extremely cautious” in the
criminal probe, Coffee said. “If they did anything, they might indict a
subsidiary” or individual executives, he added.
With JPMorgan Chase, Bank of America and MetLife under fire from the
Department of Justice and other government entities, one wonders what
big bank is next?
DON'T LEAVE OUT CHASE AND WAMU LOANS AND LONG BEACH LOANS AS WELL.
