The Department of Justice is investigating JP Morgan for allegedly marking up auto loans for customers based on their race.
This was included in the bank’s annual report, which was released on Tuesday.
So far this is all we know:
The Firm is engaged in discussions with the U.S. Department of Justice (“DOJ”) about potential statistical disparities in markups charged to different races and ethnicities by automobile dealers on loans originated by those dealers and purchased by the Firm.
There are a bunch of other DOJ investigations/legal issues disclosed in the report too. They’re on page 295.
Earlier on Tuesday JP Morgan held its Investor Day and was adamant about the importance of changing its culture so that legal issues like this don’t keep popping up over and over again. The bank acknowledged that it has to stop screwing up on this.
You see, it’s starting to impact their bottom line in a way that’s making legal fees and settlements more than just a “cost of doing business.
Check it out in the chart below.