JPMorgan Ordered to Pay $20 Million in Lehman Case

The Commodity Futures Trading Commission (CFTC) said yesterday that JPMorgan Chase & Co. will pay $20 million to settle charges that it unlawfully handled customer segregated funds at Lehman Brothers Holdings Inc., Reuters reported yesterday The action comes as the CFTC and other regulators continue to probe what happened to segregated customer funds in the October 2011 collapse of MF Global Holdings Ltd, a commodity trading firm that also did business with JPMorgan. In the Lehman case, the CFTC said that for about 22 months, ending with Lehman’s bankruptcy in September 2008, JPMorgan had improperly extended intra-day credit to Lehman Brothers based in part on customers’ segregated funds Lehman had deposited at the bank. JPMorgan also violated rules by refusing to release customers’ segregated funds for nearly two weeks after the bankruptcy, the CFTC said.