NEW YORK (AP) — JPMorgan Chase said it received notice from regulators that it could face charges over mortgage-backed investments that soured during the financial crisis.
The bank said in its annual report filed Wednesday that it received notice of a possible enforcement action from the Securities and Exchange Commission in January. The notice provides a company with a chance to argue why the action shouldn't be taken. The SEC usually follows such warnings with lawsuits or fines.
Goldman Sachs Group and Wells Fargo made similar disclosures Tuesday. The disclosures are a signal that the government is stepping up its investigations into fraudulent practices that banks might have indulged in while packaging millions of home loans into bonds during the housing boom.
When the real estate bubble burst, home values plunged and millions of people lost their homes. That also led to billions of dollars in losses for investors.
JPMorgan said the SEC is considering possible action on investigations related to how it disclosed the facts supporting mortgage-backed bonds it sold, and also those sold by Bear Stearns, the investment bank it bought in 2008.
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