JPMorgan Settles FHFA’s $33 Billion RMBS Suit

On October 25, the FHFA announced that JPMorgan had agreed to pay it $5.1 billion to settle a number of RMBS-related claims asserted by the FHFA, including in a lawsuit relating to Fannie Mae’s and Freddie Mac’s alleged purchase of $33 billion of RMBS.  Under the settlement agreement, JPMorgan will pay a total of $2.74 billion to Freddie Mac and $1.26 billion to Fannie Mae to resolve the claims asserted in the lawsuit that JPMorgan made misrepresentations in the offering documents for the RMBS it sold to those mortgage companies.  JPMorgan also will pay $670 million to Fannie Mae and $480 million to Freddie Mac to resolve separate claims related to single-family mortgages purchased by those entities.  The FHFA alleged that JPMorgan breached representations and warranties in the contracts concerning those loan sales.  Settlement Agreement and attachments.