American bank JP Morgan Chase has agreed to pay $US1.7 billion to victims of convicted fraudster Bernard Madoff.
In order to settle a case brought by prosecutors in New York, it has admitted failing to maintain an effective anti-money laundering programme. No individual executives were accused of wrongdoing.
Photo: AFP
The settlement comes after federal prosecutors accused the bank of ignoring red flags about Madoff's crimes, the BBC reports.
The bank has agreed to improve its controls as part of the settlement, which also includes a so-called deferred prosecution agreement that will dismiss criminal charges after two years if the bank remains compliant.
JP Morgan was Madoff's primary bank in the later years of a fraud that lasted for decades.
The bank had a relationship with Madoff dating back to 1986, according to documents released by the US Attorney's office.
It ended in 2008 when Madoff revealed to the FBI that his investment advisory business was a Ponzi scheme. The 75-year-old pleaded guilty to the fraud and is serving a 150-year prison sentence in the US.
