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FBN's Charlie Gasparino says major banks could pay hundreds of millions to settle with the SEC over mortgages.
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-- look at -- has broken out between New York attorney general Eric -- and and the Securities and Exchange Commission.
Over the New York attorney general's suit charging JPMorgan with securities fraud.
Over its packaging and sale of mortgage backed securities so why is the SEC so mad -- Charlie Gasparino house.
-- -- -- Right and we should point out that this item -- is very narrow it's just about Bear Stearns related practices JPMorgan what Bear Stearns during the beginning of the financial -- 2008.
Here's what we know from sources close.
To the to these securities exchange commission close to the banks involved that's this -- just Humana on -- snyderman.
I guess it overshadows.
A bigger is a bigger case TSE seen sources of Thomas RR is basically ready.
To do a deal with the banks for the banks are -- for a multi billion dollar settlement not.
With the -- with the Securities and Exchange Commission over practices related to their packaging and sale of mortgage backed securities journal -- financial crisis so it's not just JPMorgan.
And it's it's all of them and it's a big number -- -- we understand it's the -- hundreds of millions of dollars for each one.
That could be over a billion dollars this could be.
The largest financial crisis related -- settlement that has been levied to fight so -- SEC meant well site Saturday came up.
With what they think it's pretty pretty much of -- -- -- case.
-- very narrow on Bear Stearns -- JPMorgan had some sort of a comfort letter from the Securities and Exchange Commission related to Bear Stearns related issues.
It's not really worried about broke that news on -- on Alyssa frank that's right that's right yeah that's -- today just a letter it was drafted in the -- you know in the in this sort of when they were doing the -- -- -- Marriage so.
JPMorgan's -- really worried about -- what they're worried about a they have what I understand is is bigger settlement which will cover the broader bank practices.
A package of of creating these mortgages -- these mortgages.
Creating and putting an end in.
In mortgage backed securities and selling -- and I'm telling you.
This is from what I understand gonna be a big number it could be I think it will be the largest global settlement they're gonna do with all the banks.
Largest broad settlement upfront financial related to financial crisis related stuff that we've seen this -- of -- thing is -- Justine.
In in the sense that it's very narrow but it yeah it it's sort of disguises the bigger issue out there any kind of preempt DSC I mean I take the SEC from what I understand.
Is is just hopping mad over -- they've been investigating this stuff.
For a couple years they think they have essentially.
A pretty good solid case and the banks if you've noticed something.
It tells you how solid is the banks have been buying some these mortgage backed securities -- right right from from from from their investors why they doing this well they're trying to basically.
On were on what unwound this whole thing -- to show the SEC that they've not committed securities fraud and that's the whole thing.
I believe -- have been charged in -- securities forward attend it's it's equivalent to ten B five.
It's you know it's under the Martin act which gives him wide latitude in New York State law which you can base which are somewhat fraud.
Over you know parking ticket the FCC I don't think we'll go as far as a ten B five charged but the number is going to be pretty big when I understand each bank.
Hundreds of millions of dollars and this is a pretty big story.
Why.
If it's silly to think that the AG's office -- met -- discussed this with the SEC ahead of this at that they'd be on oil paints I think they did discuss it I think based he's the one -- with that I mean listen this guy.
This what do they call the AG in New York -- attorney general AG -- quote almost governor I mean you know yeah that is an hour at this is a steppingstone thing.
Life goes and I was the first really to cover Eliot Spitzer when I was at the Wall Street Journal as -- -- I basically.
I I did -- story which gave him his first big case against Henry Blodget.
And and Merrill Lynch so I know this office pretty well you know there's been the public a couple of junkyard dogs in that -- mainly Eliot Spitzer.
And yet Snyder I think Cuomo was kind of a junkyard dog when not to the same same degree but it's -- it's a stepping stone and you use this.
This sort of this office as a -- to get publicity but I think this went a little further in this sense the case was very narrow.
He did not he didn't basically it was kind of a cheap vocational Bear Stearns Bear Stearns has been dead for how many years -- -- one executive.
Was -- Right that they named one person that did something wrong they're basically telling that student JPMorgan shareholders you're responsible before what a bunch of lunatics have Baird did.
In 2006 to doesn't seven.
And I guess what that means your shareholders have to pay up for -- for doing some that by the way we should point out the government.
Asked JPMorgan to buy Bear Stearns rate five times.
Yes Jamie diamond what he's -- to make money have it but I bet you when he headed up it's a wash.
John I guess -- don't --
