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JPMorgan agrees to settle Pittsburgh FHLB mortgage suit

JPMorgan Chase has reached a settlement agreement with the Federal Home Loan Bank (FHLB) of Pittsburgh, to resolve various charges of deceiving its investors over securities containing toxic mortgages bonds.

The settlement with FHLB follows after a US judge ordered JPMorgan to handover the plaintiff’s lawyers a draft of the US Justice Department’s proposed complaint that the record settlement was based on, reported Bloomberg.

In 2009, FHLB of Pittsburgh filed a lawsuit against JPMorgan and credit-ratings companies over losses on $1.8bn in mortgage-backed securities it purchased during 2006 and 2007.

Both firms did not disclose the settlement amount. The FHLB claimed that the conduct, transactions and issuees in its case were the same as those addressed in the settlement with the government.

Fitch Group, one of the accused in the Pittsburgh bank’s case, also agreed to settle claims pertaining to its ratings on mortgage backed securities.