(CNN) -- If the reports of a proposed $13 billion settlement between the Justice Department and JPMorgan Chase & Co. are correct, the public and the company's shareholders will not see justice done.
While the tentative deal is being portrayed as a larger settlement, it really represents the company coming forward with an additional $9 billion. The other $4 billion represents loan workouts that JPMorgan would do anyway to reduce its losses on mortgages that would otherwise cause it greater losses through foreclosure.
From the perspective of the company's shareholders, the problems amount to an even bigger loss because of alleged fraud. The full $13 billion would represent a loss to the shareholders, and JPMorgan estimates its future increased legal and investigative costs for its past scandals at $9.2 billion.
A settlement of this kind would release JPMorgan and its officers from civil and criminal liability for a wide range of alleged frauds. Many of these alleged frauds added to the profits of JPMorgan and the companies it acquired. The shareholders should not be enriched by fraud, and the perpetrators should be held accountable for their individual actions, not just the company as a whole.
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