JPMorgan Chase & Co. to pay up in Enron case

JPMorgan Chase & Co. to pay up in Enron case

JPMorgan Chase & Co. has finally agreed to pay up $350 million in cash along with another bank Toronto-Dominion Bank who would be paying up $70 million to resolves the disputes against them in the Enron Bankruptcy case. They are being blamed for helping Enron Corporation executives in carrying out the fraud that has resulted in huge loses for the investors. The scandal later resulted in the bankruptcy of the company.

The banks have also said that they would be foregoing some of their own claims against the company. And the money they are paying up would be distributed amongst the creditors. Arvind Sachdeva, a senior portfolio manager at Victory Capital Management in Cleveland spoke about the banks decision to pay up the fines: “The companies want to get these issues behind them and move on. It’s a distraction to management, though I expect a lot of the litigation exposure is already priced into the stocks.”

JPMorgan had already agreed to pay up$2.2 billion to resolve an investor class-action lawsuit over Enron in the month of June. This comes in addition to that decision. With this latest news, Enron has settled with five of the 10 banks in its “MegaClaims” litigation. John Ray, Enron’s board chairman said in a statement: “These are tremendous results for creditors, and they will certainly add to their distributions.”

However, these settlements would require approval by the U.S. bankruptcy court in Manhattan.