WASHINGTON – JPMorgan Chase has agreed to pay $5.1 billion to resolve claims that it misled US mortgage giants Fannie Mae and Freddie Mac about risky home loans and mortgage securities it sold them before the housing market collapsed. The Federal Housing Finance Agency, which oversees Fannie and Freddie, announced the settlement Friday with JPMorgan, the largest US bank. A broader deal with the Justice Department is still being negotiated. Under the terms of the settlement, JPMorgan admits no wrongdoing. The settlement is the start of what could be the largest penalty the government has extracted from a company for actions related to the financial crisis. The crisis, triggered by vast sales of risky mortgage securities, plunged the economy into the deepest recession since the Great Depression. JPMorgan sold $33 billion in mortgage securities to Fannie and Freddie between 2005 and 2007, according to the agency. That was the second-most sold to Fannie and Freddie ahead of the crisis, behind only Bank of America. The securities soured after the housing bubble burst in 2007, losing billions in value. In a statement, JPMorgan called the agreement "an important step towards a broader resolution of the firm's" mortgage-related matters. Edward DeMarco, the FHFA's acting director, said the settlement with JPMorgan "provides greater certainty in the marketplace." – AP
