JPMorgan Chase and Credit Suisse Subpoenaed by SEC over Failed Mortgages (JPM, CS)

JPMorgan Chase & Co. JPM and Credit Suisse CS received subpoenas from the U.S. Securities and Exchange Commission (SEC) over failed mortgages, a personal familiar with the investigation told Bloomberg. Allegedly, Credit Suisse didn't share refunds from sellers of faulty debt. Credit Suisse, Bear Stearns (which JPMorgan acquired in 2008), and Bank of America, among others, have faced investigation over mortgage-related securities. The Bloomberg report notes that "Credit Suisse received a subpoena from the SEC last week, bond insurer MBIA Insurance Corp. said in a filing yesterday in a lawsuit against three of that Zurich-based bank's units. The agency asked New York-based JPMorgan for information after a court in January unsealed allegations made about Bear Stearns Cos.' practices in another suit, said the person, who declined to be identified because the matter isn't public." JPMorgan Chase & Co. is a financial holding company with a market capitalization of $180 billion. Credit Suisse, based in Switzerland, provides advisory services, solutions and products to companies, institutional clients and private clients globally. According the Bloomberg report, "Bond insurers MBIA and Ambac Assurance Corp. have said Credit Suisse and Bear Stearns, which JPMorgan bought in 2008, demanded refunds from originators that sold the banks the loans that they packaged into bonds, and then failed to use those settlement amounts to fulfill their own contractual promises on the debt." Shares of JPMorgan fell $0.33 on Thursday, to $45.17. Shares of Credit Suisse fell $0.86, or 2%, to $42.90.