Beginning Next Week: InsideCounsel will become part of Corporate Counsel. Bringing these two industry-leading websites together will now give you comprehensive coverage of the full spectrum of issues affecting today's General Counsel at companies of all sizes. You will continue to receive expert analysis on key issues including corporate litigation, labor developments, tech initiatives and intellectual property, as well as Women, Influence & Power in Law (WIPL) professional development content. Plus we'll be serving all ALM legal publications from one interconnected platform, powered by, giving you easy access to additional relevant content from other InsideCounsel sister publications.

To prevent a disruption in service, you will be automatically redirected to the new site next week. Thank you for being a valued InsideCounsel reader!


Barney Frank defends JPMorgan against government lawsuit

The congressman says banks shouldn’t be held responsible for the misdeeds of companies they acquired at the government’s urging

Barney Frank—Democratic congressman, co-author of the Dodd-Frank Wall Street Reform and Consumer Protection Act and champion of financial reform—thinks the government is being too hard on the banks.

On Monday, Frank defended JPMorgan Chase & Co. in a statement, saying that the government shouldn’t try to punish the country’s largest bank for the alleged misdeeds of a bank it acquired during the financial crisis.

On Oct. 1, N.Y. Attorney General Eric Schneiderman filed a lawsuit against JPMorgan, accusing Bear Stearns, which JPMorgan absorbed in 2008, of defrauding investors with mortgage-backed securities that it did not inspect for quality.

However, because JPMorgan acquired Bear Stearns at the urging of the federal government, Frank says he feels it’s unfair to now punish the bank for Bear Stearns’ misbehavior.

"The decision now to prosecute J.P. Morgan Chase because of activities undertaken by Bear Stearns before the takeover unfortunately fits the description of allowing no good deed to go unpunished," Frank said in his statement.

Earlier this month, JPMorgan CEO Jamie Dimon called the lawsuit unfair, saying his company is still paying the price for doing the Federal Reserve a “favor” by absorbing Bear Stearns.

Former N.Y. Attorney General Eliot Spitzer is on Schneiderman’s side. "It is a necessary action to bring accountability for the mortgage meltdown and the financial collapse,” Spitzer said in a statement. “Widespread misconduct should not disappear simply because one bank has been acquired by another."

Read more at Thomson Reuters.


For more InsideCounsel coverage of lawsuits related to the financial crisis, see below:

Bank of America pays $2.43 billion in shareholder suit settlement

Lehman Brothers to pay another $10.5 billion to creditors

Citigroup will pay $590 million in settlement related to financial crisis

Join the Conversation

Advertisement. Closing in 15 seconds.