A major lender has announced a new wave of job cuts, even as a Department of Justice criminal investigation encroaches.
JPMorgan Chase is cutting 475 jobs in its mortgage default servicing unit, according to the Dallas Business Journal. All the cuts will affect Chase employees in Texas, with the majority in Fort Worth. Another 450 mortgage jobs are in South Carolina are also on the chopping block, according to a McClatchy-Tribune Information Services report.
Chase spokesman Greg Hassell told the Dallas Business Journal that the mortgage default servicing unit, which increased staffing during the housing crisis, it cutting back now that the market is recovering.
“There are far fewer people who are behind on their mortgages,” Hassell said.
Layoffs in Chase’s mortgage division are nothing new. In February, the banking giant announced that it would be eliminating between 13,000 and 15,000 positions in its mortgage department, according to McClatchy. The layoffs are expected to be completed by 2014.
Chase’s woes are compounded by an ongoing criminal investigation. According to a Bloomberg report, the Department of Justice is probing the practices behind Chase’s sales of mortgage-backed bonds.In May, the DOJ issued a preliminary finding that Chase broke civil laws in the sale of securities tied to subprime and Alt-A loans, Bloomberg reported.
Chase reported a second quarter net income of $6.5bn, according to an SEC filing.