Some good news for former PFG customers today, as the PFG trustee Ida Bodenstein is requesting the bankruptcy judge approve a $15 Million settlement with the bank. Here’s what the court document states:
“(ii) Obtain the release of $14,000,000 for the Estate, which is currently being held by JP Morgan as a security for JP Morgan’s contingent claims against the estate.”
“(iii) Resolve the Estate’s and the Customer’s Representative Plantiff’s claims against JP Morgan in exchange for cash consideration of $1,250,000 from JP Morgan, which is in addition to the reduction and cap on JP Morgan’s claims and the eventual release of the funds held as security for those claims.”
“(iv) implement a cooperative course of proceeding with the Customer Representative Plaintiffs with respect to (a) the claims against the remaining defendants in the class action and (b) the disbursement of any proceeds under the Settlement Agreement and an account of the remaining claims in the class action proceeding.”
In layman’s terms, JP Morgan is agreeing to pay $1.25 Million to settle any claims against it by the customers, and release $14 Million in customer money it’s been holding as collateral against what we would call ‘phantom’ claims against PFG. It’s a far cry from $200 million, but it is another victory for former customers and step towards getting entirely whole.
For JP Morgan, this is a drop in the bucket… or whatever is less than that. Last year they paid almost $13 Billion to the Justice Department in fines, and before that paid $100 Million in its connection to MF Global. Jamie Dimon’s secretary probably makes more than the $1.25 million they agreed to pay.
Now if the lawyers at US Bank could just agree to settle with the CFTC in its lawsuit, everyone would be happy.