JPMorgan deal brings $300M to Calif. pension funds

Getty Images file photoJPMorgan Chase Co. will pay nearly $300 million to California public employee and teacher pension funds.

Getty Images file photoJPMorgan Chase Co. will pay nearly $300 million to California public employee and teacher pension funds.

JPMorgan Chase & Co. will pay nearly $300 million to California's public employee and teacher pension funds as part of a settlement related to mortgage-related investments, state Attorney General Kamala Harris announced Tuesday.

The $299 million in damages will settle claims that the company misrepresented the value of residential mortgage-backed securities sold to the California Public Employees Retirement System and California State Teachers' Retirement System between 2004 and 2008.

“JP Morgan Chase profited by giving California's pension funds incomplete information about mortgage investments,” Harris said in a statement. “This settlement returns the money to California's pension funds that JP Morgan wrongfully took from them.”

The settlement is part of a broader, $13 billion settlement between the investment company and the U.S. Department of Justice. Under the larger settlement, JPMorgan will provide $4 billion in mortgage relief to the states, including California.

Harris said her office's investigation found that documents provided by the company did not accurately disclose the nature of the underlying mortgages and that the company did not properly eliminate risky loans from the securities it was offering the pension funds.

The settlement will reimburse the funds for the losses they took for investing in mortgage-backed securities offered by JPMorgan, Washington Mutual Bank and Bear Stearns. JPMorgan acquired the other two companies in 2008 and has said most of its mortgage-backed securities came from them.

The federal settlement includes $4 billion in mortgage relief for consumers nationwide who were harmed by the same three firms. The money will go toward loan modifications, forgiving the principal on mortgages and efforts to improve blighted neighborhoods.

Harris' office could not predict how much of the $4 billion will come to California but said the distribution will be overseen by an independent monitor to make sure the company meets its obligations under the settlement. It was not clear how the $300 million is being carved from in the $13 billion settlement.

California also is receiving about $20 billion from a separate national mortgage settlement in 2012. That deal was with the nation's largest banks, including JPMorgan.

CaliforniaCalifornia NewsJPMorgan Chase Co.Kamala Harrispension funds

If you find our journalism valuable and relevant, please consider joining our Examiner membership program.
Find out more at www.sfexaminer.com/join/

Just Posted

U.S. Attorney David Anderson announces federal firearms charges against two men for their roles in a March 2019 shooting outside the Fillmore Heritage Center in a news conference alongside SFPD staff at the Phillip Burton Federal Building on Thursday, Jan. 9, 2020. (Kevin N. Hume/S.F. Examiner)
Departing U.S. attorney predicts corruption probe will continue

David Anderson shook up City Hall as top federal prosecutor

Board of Supervisors President Shamann Walton, a former school board member, has been asked to help secure an agreement between the school district and teacher’s union. <ins>(Kevin N. Hume/S.F. Examiner)</ins>
 <ins></ins>
Supervisor Walton tapped to mediate teacher contract talks

District and union at odds over hours in-person students should be in the classroom

California is set to receive supplies of the Johnson & Johnson vaccine, which is still under review by the U.S. Food and Drug Administration. (Courtesy photo)
California could receive 380K doses of new J&J COVID vaccine next week

California could receive 380,300 doses of the new Johnson & Johnson vaccine… Continue reading

Disability advocates protested outside the home of San Francisco Health Officer Tomas Aragon. (Courtesy Brooke Anderson)
Vaccine rollout plan for people with disabilities remains deeply flawed

On February 13, disability activists paid a visit to the house of… Continue reading

A Bay Area Concrete Recycling facility that opened on PG&E property in 2019. Former PG&E employees have been accused of accepting bribes from Bay Area Concrete. (Courtesy of Bay Area Concrete Recycling via ProPublica)
Lawsuit reveals new allegations against PG&E contractor accused of fraud

By Scott Morris Bay City News Foundation Utility giant Pacific Gas &… Continue reading

Most Read