JPMorgan to pay $614m to settle charges on bad loans

NEW YORK, Feb 5 (AFP): JPMorgan Chase will pay $614 million to settle US charges that it approved thousands of bad loans that wrongly qualified for federal insurance, the Department of Justice announced Tuesday.

The big US bank approved thousands of mortgage loans that were guaranteed by Federal Housing Administration and hundreds that were guaranteed by the Department of Veterans Affairs, even though they did not meet requirements, the Justice Department said.

The US agencies suffered "substantial losses" due to JPMorgan's approval of bad loans, Justice said.

"JPMorgan Chase put profits ahead of responsibility by recklessly churning out thousands of defective mortgage loans, failing to inform the government of known problems with those loans and leaving the government to cover the losses when the loans defaulted," said Preet Bharara, US Attorney for the Southern District of New York.