Bonnie Kavoussi, Huffington Post
JPMorgan Chase CEO Jamie Dimon has tried his best to suggest that the financial crisis was someone else’s fault. But a batch of court documents released this week undermine this claim, indicating that the bank knew the mortgage investments it sold were seriously flawed.
According to the documents, which include emails and transcripts of employee interviews filed in an investor lawsuit, JPMorgan hired independent analysts to review the quality of the home loans it was packaging for sale prior to the collapse of the housing market. That review found that 20 to 80 percent of the mortgages did not meet underwriting standards, Bloomberg reports. These documents show thatJPMorgan bundled these mortgages into complex securities anyway and then sold them to investors without disclosing their problems, according to Bloomberg and the New York Times.
Flaws identified by the reviews included loans made to overstretched borrowers, missing documentation and fraudulent home appraisals, according to Bloomberg and the NYT. The court documents make clear that JPMorgan employees were well aware of these flaws and even exchanged emails about them. For example, after a review finding that at least 1,154 mortgages were delinquent, JPMorgan told investorsthat only 25 loans were delinquent, according to court documents reviewed by the NYT.