California Real Estate Fraud Report

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JPMorgan Chase Settles Securities Fraud Case for $153.6m

The securities division of financial giant JPMorgan Chase & Co. has agreed to pay out $153.6 million to compensate investor groups that lost large sums of money due to the hedge fund Magnetar Capital betting against the securities portfolio that it had convinced the investors to purchase.

The investor groups that lost big due to the omission. Unlike Chase, investment firm Goldman Sachs Capital Partners (GSCP) and its team leader Edward Steffelin, Magnetar was not charged by the Securities and Exchange Commission (SEC), which led the investigation. SEC enforcement chief Robert Khuzami said Magnetar “was not responsible for those disclosures to investors.” Maybe not legally, but certainly ethically.

“The victim investor groups are Minneapolis-based Thrivent Financial for Lutherans; Security Benefit Corp., an insurance and retirement services company based in Topeka, Kansas; General Motors Asset Management, which manages the automaker’s pension plans for GM workers. Also taken in were Tokyo Star Bank, Far Glory Life Insurance Co. Ltd., Taiwan Life Insurance Co. Ltd. and East Asia Asset Management Ltd.

Goldman Sachs Capital Partners paid $550 million last year for its role in misleading the investors.

The SEC’s complaint against Edward Steffelin can be read here.

Read the original article in the New York Times.

© Copyright 2007-2018 Monique Bryher

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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