by Richard A. Epstein
October 29, 2013
JP Morgan Chase (JPM) just had a bad week dueling with the federal government. First, it got slapped with a $5.1 billion settlement with the Federal Housing Finance Agency (FHFA) for its mortgage dealings with Fannie Mae and Freddie Mac; then, it got wrapped into a criminal investigation involving Bernie Madoff’s Ponzi scheme, which the government now insists that JPM should have detected. In both civil and criminal proceedings, the Department of Justice is bringing to heel a bank that came into two major mistakes. First, the bank did business with the federal government. Second, it was regulated by it.