Ignoring Madoff to cost JPMorgan $2 billion

NEW YORK, Dec. 12 (UPI) -- JPMorgan Chase is expected to pay up to $2 billion for failing to alert U.S. authorities about Bernard Madoff, sources told the New York Times.

Madoff, who is serving a 150-year sentence for running a two-decades long Ponzi scheme that lost $17 billion, used JPMorgan as his primary bank while he ran his fraudulent investment firm.

Madoff was arrested five years ago. As that anniversary comes and goes, federal prosecutors are winding up negotiations with JPMorgan.

The settlement is likely to include $1 billion in Justice Department penalties for failing to alert authorities that Madoff's accounts included suspicious transactions. Regulators in Washington are expected to impose another $1 billion in fines for the bank's general lack of strong oversight on money laundering activities, the Times said Wednesday.

One bank executive said in a private lawsuit that Madoff's "Oz-like signals were too difficult to ignore," referencing a time frame before the prominent New York trader was arrested.

"You read about Madoff in the paper the other day. We have to get some of these things behind us so we can do our job," JPMorgan Chief Executive Officer Jamie Dimon said Wednesday during a conference call.