WASHINGTON — JPMorgan Chase & Co. has agreed to a settlement worth more than $700 million over Securities and Exchange Commission charges that it made unlawful payments to friends of public officials to win municipal bond business in Jefferson County, Ala.
In a civil lawsuit, the SEC also accused two former managing directors of JPMorgan, Charles LeCroy and Douglas MacFaddin, of securities law violations.
The SEC alleged that JPMorgan, LeCroy and MacFaddin made about $8 million in undisclosed payments to close friends of several Jefferson County commissioners. Starting in July 2002, LeCroy and MacFaddin solicited the county for a $1.4 billion sewer bond deal.
Swayed by the payments, the county commissioners voted to select JPMorgan's securities division as managing underwriter of the bond offerings and its affiliated bank as swap provider for the transactions, the SEC said.