Regulator to penalize JPMorgan over Lehman demise

A US regulator is set to penalize JPMorgan for actions linked to the demise of investment bank Lehman Brothers at the height of the financial crisis in 2008, the New York Times said, citing people briefed on the matter. The Commodity Futures Trading Commission (CFTC) is expected this week to file a civil case against JPMorgan. The bank is expected to settle the Lehman matter and pay a fine of about $20 million, the paper said. Such a move will be the first federal enforcement case resulting from Lehman\'s downfall, the New York Times said. The CFTC is expected to accuse JPMorgan of overextending credit to Lehman for two years leading up to its bankruptcy in 2008, according to the newspaper. JPMorgan extended the credit using an inaccurate evaluation of Lehman\'s worth, improperly counting Lehman\'s customer money as belonging to the firm, the newspaper said, adding that firms are not allowed to use customer money to secure or extend credit under federal law. The regulator is also set to accuse JPMorgan of withholding separate Lehman customer funds for nearly two weeks, rather than turning them over to authorities, the New York Times said. JPMorgan declined to comment to the New York Times. The newspaper said the bank is expected to neither admit nor deny wrongdoing as part of the settlement.