WASHINGTON (Reuters) - JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) has agreed to pay $2 million to settle charges its subsidiaries helped now-bankrupt National Century Financial Enterprises carry out a fraud that resulted in $2.6 billion of investor losses, the U.S. Securities and Exchange Commission said on Thursday.
The SEC said JPMorgan Chase Bank and Bank One served as indenture trustees for National Century, a Dublin, Ohio, healthcare financing company, from 1999 until 2002 when the company collapsed.
The SEC said that JPMorgan helped National Century make large improper transfers among program accounts, which caused collateral shortfalls and contributed to the company's downfall.
JPMorgan settled without admitting or denying the charges. A spokesman from JPMorgan confirmed the settlement but declined to provide additional details.
The SEC said JPMorgan would pay $1.3 million in disgorgement and about $700,000 in prejudgment interest to settle the charges.
On Wednesday, the U.S. Justice Department said a federal jury in Ohio convicted National Century's former chief executive Lance Poulsen of witness tampering in a criminal fraud case.
The witness tampering charge was linked to a key witness who was scheduled to testify in the trial of Poulsen and other executives for an alleged $2 billion fraud at National Century.
The Justice Department said Poulsen would be tried on fraud charges in August. Earlier this month, five other National Century executives were found guilty of scheming to deceive investors and credit rating agencies about the company's financial health.
(Reporting by Karey Wutkowski, Editing by Toni Reinhold)
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