NEW YORK — JPMorgan Chase and federal authorities are nearing settlements over the bank’s ties to Bernard L. Madoff, striking tentative deals that would involve roughly $2 billion in penalties and a rare criminal action. The government will use a sizable portion of the money to compensate Madoff’s victims.
The settlements would fault the bank for turning a blind eye to the huge Ponzi scheme, according to people briefed on the case who were not authorized to speak publicly. Madoff was arrested at his New York penthouse five years ago Wednesday.
A settlement with federal prosecutors in Manhattan, the people said, would include a so-called deferred-prosecution agreement and more than $1 billion in penalties to resolve the criminal case. The rest of the fines would be imposed by Washington regulators investigating broader gaps in the bank’s money laundering safeguards. Full story for BostonGlobe.com subscribers.