With JPMorgan Chase & Co. (JPM) agreeing yesterday to a historic settlement with the U.S. government that saw the banking giant admit guilt in its handling of its mortgage business, the question on the minds of most in the mortgage market was simple: is this really the end? Can JPMorgan, and by extension other banks like Wells Fargo & Co. (WFC) and Bank of America (BAC), finally start to see the light at the end of the proverbial tunnel?
DOJ officials made it clear yesterday that the answer to that question is: nope.
On a panel moderated by longtime banking industry attorney Gordon Greenberg, the question was put to a pair of senior DOJ officials: Andre Birotte, United States Attorney, Central District of California, and Jaikumar Ramaswamy, chief of the DOJ’s Asset Forfeiture and Money Laundering Section.
Greenberg, a partner with the international law firm McDermott Will & Emery, seemed to suggest that after the JPMorgan settlement, you know, maybe enough is enough…?
“Seems as though, from a common sense standpoint, all that has transpired, maybe even culminating with another massive settlement today, albeit civil, for $13 billion dollars, that this is conduct that’s really historical, related to the financial debacle,” he began.
“So from a risk standpoint, if I am a financial institution, in light of all the mortgage guidelines, all the different details that are in place to deal with mortgage issues today throughout the system… Top priority? Mortgage fraud with financial institutions? Or can they put it on a lower risk level now in light of where we are today?”
Absolutely not, said Birotte, whose district includes the city of Los Angeles. “It is a top priority,” he said. “We’ve got a big case in our district, and the reality is that, all the way up to the president, they’ve made it clear that they want to make sure people are held accountable, whether it’s criminal or civil, and utilizes all the tools that are available.”