A former deal manager at JPMorgan Chase (JPM) who was laid off in 2008 said she witnessed a “massive criminal securities fraud” while working at the bank during the years that lead up to the financial crisis but was forced to stay silent, according to Rolling Stone.
“It was like watching an old lady get mugged on the street,” A layne Fleischmann told the magazine. “I thought, ‘I can’t sit by any longer.'”
Fleischmann believes there is proof that the bank committed a crime including evidence that the firm made material misrepresentations about subprime loans, made material omissions, willfully and with specific intent and consciously ignored warnings from inside the firm and out, the magazine said.
She’d like to see something done about it, it added.
Fleischmann, a securities lawyer, said she began working with U.S. prosecutors in 2012, but because of a confidentiality agreement, she wasn’t allowed to speak publicly about what the saw.
The bank eventually settled with the government for what reports at the time said was $13 billion in an agreement that kept details under wraps aside from statements of facts. Rolling Stone says the settlement was more like $9 billion.
The bank told CNBC on Friday it would not comment on the story.
A former JPMorgan deal manager says she witnessed a “massive criminal securities fraud” at the firm, but was forced to keep it a secret, according to Rolling Stone.