JPMorgan, SEC in settlement talks on CDO deal – FT

CHICAGO, April 2 (Reuters) – JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) is
in settlement talks with a U.S. regulator to end a probe into
how the investment bank marketed a deal involving subprime
mortgages in 2007, according to the Financial Times.

A settlement between JPMorgan and the U.S. Securities and
Exchange Commission could be reached within weeks, the paper
said.

The SEC declined to comment on the report, while
representatives of JPMorgan could not be reached for comment.

The 2007 deal, called “Squared,” was a collateralized debt
obligation, or CDO. CDOs are complex financial instruments that
have been blamed for worsening the global financial crisis in
2008.

The SEC investigation centered around whether JPMorgan
adequately disclosed to investors that a hedge fund, Magnetar,
helped to select assets for the deal while betting against
parts of it.
(Reporting by Nick Carey; editing by Mohammad Zargham)

JPMorgan, SEC in settlement talks on CDO deal – FT