JPMorgan Chase is in another pickle, one that reportedly could cost it a billion dollars.

The Wall Street Journal reported on Wednesday (subscription only) that the biggest U.S. bank by assets is close to cutting a deal with the Federal Energy Regulatory Commission (FERC), which would have JPMorgan paying a record fine of possibly "close to $1 billion" to settle charges of manipulating energy markets in California and Michigan in 2010 and 2011, respectively. Such a fine would be fairly easily absorbed by JPMorgan, which earlier this week reported a quarterly profit of $6.5 billion.

The FERC investigation into energy-market manipulation, with its echoes of the Enron scandal, has been ongoing for at least a year. FERC claims that JPMorgan traders tricked wholesale power dealers in California and Michigan into paying too much for energy, which may have raised overall electricity costs by $83 million.

FERC notified the bank in May that it could face a regulatory action, and that targets could include the bank's commodities head, Blythe Masters, most famous as the inventor of the credit default swap.

JPMorgan has denied any wrongdoing, but the WSJ reports that "there is now a strong movement within J.P. Morgan to get a deal done quickly amid heightened regulatory scrutiny on several fronts." It is not clear from the report whether Masters or any other individuals would be involved in any settlement.

News of the JPMorgan deal comes a day after the FERC made similar accusations against the British bank Barclays, say it manipulated California's energy market between 2006 and 2008. In that case, FERC wants Barclays to pay a $435 million fine and cough up another $34.9 million in what it calls ill-gotten profits, along with $18 million from former traders. The British bank, which last year paid $453 million to U.S. and U.K. regulators to settle charges it manipulated the short-term interest rate known as LIBOR, is fighting FERC's charges.

JPMorgan, coincidentally, is also one of the many banks in the U.S., U.K. and Europe still under investigation in the LIBOR scandal -- just one of the many regulatory headaches dogging the bank recently. Most famously, JPMorgan lost $6.2 billion last year with bad trades on credit derivatives made by a trader known as the "London Whale." That led to a Senate investigation that accused the bank of hiding information from regulators and investors.

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  • 10. SunTrust Banks Inc.

    Loans in foreclosure: 6,001 Avg. property value: $207,157 Pct. seriously underwater: 64% More than 6,000 loans serviced by SunTrust Banks Inc. (NYSE: STI) were in foreclosure as of February. Like most U.S. banks, SunTrust has been embroiled in controversy over its lending and foreclosure practices in recent years. SunTrust was one of five major lenders that in November agreed to pay a combined $162 million to settle complaints that it charged improper fees on home finance loans for veterans. Earlier in 2012, the bank agreed to pay $21 million to settle allegations that it overcharged more than 20,000 Hispanic and African American borrowers between 2005 and 2009. <a href="" target="_blank"> Read More At 24/7 Wall St. </a>

  • 9. PNC Financial Group

    Loans in foreclosure: 8,545 Avg. property value: $185,306 Pct. seriously underwater: 55% PNC Financial Group Inc. (NYSE: PNC) serviced more than 8,500 loans in the foreclosure process as of last month. The average property value was just $185,306, one of the lowest of all banks, and the average debt on these mortgages was $202,286. Of the 8,545 loans in the foreclosure process, approximately 55% were considered seriously underwater. At the end of 2012, PNC was the 10th largest mortgage servicer in the country, with a portfolio size of $169.4 billion. PNC was recently required to pay $70 million in order to settle allegations of illegal foreclosure practices. <a href="" target="_blank"> Read More At 24/7 Wall St. </a>

  • 8. HSBC Holdings

    Loans in foreclosure: 16,317 Avg. property value: $233,670 Pct. seriously underwater: 60% More than 16,000 loans serviced by HSBC Holdings PLC (NYSE: HBC) were in the foreclosure process as of February 2013. Six in 10 of these mortgages were considered seriously underwater. In January, the bank agreed to pay $249 million to settle complaints that it had wrongfully foreclosed on U.S. homeowners. Under the terms of the settlement, the bank paid out $96 million to 112,000 homeowners, while the remainder of the money went to reducing mortgage balances and forgiving outstanding principal on short sales, or selling a property for less than what is owed. Earlier this month, HSBC announced it was selling $3.2 billion worth of consumer loans to trim down U.S. operations <a href="" target="_blank"> Read More At 24/7 Wall St. </a>

  • 7. Citigroup

    Loans in foreclosure: 27,697 Avg. property value: $202,390 Pct. seriously underwater: 54% Citigroup Inc. (NYSE: C) serviced $6.3 billion in outstanding mortgage debt on homes in foreclosure, the seventh highest amount of all banks. Of homes in the foreclosure process, 54% were considered seriously underwater. While this figure is high, it was better than most of the nation’s largest banks. Citigroup is still fighting court battles regarding its mortgage practices as authorities accuse it of unfairly evicting people from their homes. These legal proceedings continue to hurt the company’s bottom-line. <a href="" target="_blank"> Read More At 24/7 Wall St. </a>

  • 6. Bank of New York Mellon

    Loans in foreclosure: 31,821 Avg. property value: $236,703 Pct. seriously underwater: 67% At the end of 2012, Bank of New York Mellon Corp. (NYSE: BK) had $1.4 trillion under management and more than $26 trillion under custody. A core focus of the company’s business is its function as a custodian, tasked with safeguarding financial assets and handling various monetary and financial transactions. During the financial crisis, the Treasury Department named the bank as custodian for its bailout fund — meaning the bank provided record keeping and cash management for the fund. Although BNY Mellon is not a loan servicer responsible for executing the foreclosure process on delinquent loans, it is listed as the plaintiff or beneficiary in nearly 32,000 foreclosure proceedings nationwide, according to RealtyTrac data. The bank is listed because it acts as trustee on certain mortgage-backed securitizations, which are created when a large number of mortgage loans are pooled and placed in a trust. Foreclosure action related to properties held in the trust must be brought in the trustee’s name even though the trustee is not involved in the day-to-day foreclosure proceedings. <a href="" target="_blank"> Read More At 24/7 Wall St. </a>

  • 5. Deutsche Bank

    Loans in foreclosure: 33,608 Avg. property value: $228,446 Pct. seriously underwater: 63% In January 2007, Deutsche Bank A.G. (NYSE: DB) bought home loan provider MortgageIT for $430 million. Soon after, the U.S. housing market collapsed. In May 2012, the bank agreed to pay the U.S. federal government more than $200 million to resolve charges that MortgageIT misrepresented the quality of mortgage loans it insured on behalf of the Federal Housing Administration. Three years ago, Deutsche Bank also paid the Federal Deposit Insurance Corporation $54 million to settle allegations against MortgageIT. While Deutsche Bank does not have a servicing arm, it acted as a trustee on more than 33,000 loans in the foreclosure process across the country, twice the number of any other non-U.S. bank.

  • 4. U.S. Bancorp

    Loans in foreclosure: 44,881 Avg. property value: $206,754 Pct. seriously underwater: 62% Nearly 45,000 loans serviced by U.S. Bancorp (NYSE: USB), with a cumulative property value of just under $9.3 billion, were in default as of February. About 28,000, or 62%, of all mortgages in foreclosure were considered seriously underwater. The bank was among the 10 financial institutions that agreed to pay $8.5 billion to settle allegations of widespread mortgage abuse in the foreclosure process, with U.S. Bancorp’s share of the payments totaling $80 million. The bank was the third-largest mortgage originator in 2012, lending $84.5 billion. This was up significantly from the $49.1 billion it lent in 2011. <a href="" target="_blank"> Read More At 24/7 Wall St. </a>

  • 3. JPMorgan Chase

    Loans in foreclosure: 54,325 Avg. property value: $208,183 Pct. seriously underwater: 54% As of February 2013, J.P. Morgan Chase & Co. (NYSE: JPM) serviced nearly 55,000 mortgages that were in the foreclosure process, worth $11.4 billion. Fortunately for the bank, just 54% of those homes in foreclosure were considered seriously underwater, a significantly lower percentage than banks such as Bank of New York Mellon and Deutsche Bank. The bank was able to provide more loans in 2012 than it did in previous years. That year, the bank was responsible for 10% of all mortgage loans in the United States, worth $182.2 billion. This was up from the $146.7 billion the company had lent in 2011. <a href="" target="_blank"> Read More At 24/7 Wall St. </a>

  • 2. Wells Fargo

    Loans in foreclosure: 84,903 Avg. property value: $205,550 Pct. seriously underwater: 56% Wells Fargo & Co. (NYSE: WFC) serviced $19.9 billion in total mortgage debt, a higher figure than any other bank except for Bank of America. Wells Fargo’s past lending practices received intense scrutiny in the past several years. The bank was one of the 10 servicers that participated in the $8.5 billion mortgage settlement announced in January. The bank was also required to pay $175 million in 2012 to settle accusations that it discriminated against African American and Hispanic customers between 2004 and 2009. Despite these troubles, Wells Fargo was the largest mortgage lender in the U.S. during 2012, originating 28% of all mortgages, worth $524 billion. <a href="" target="_blank"> Read More At 24/7 Wall St. </a>

  • 1. Bank of America

    Loans in foreclosure: 96,319 Avg. property value: $203,956 Pct. seriously underwater: 61% Bank of America Corp. (NYSE: BAC) serviced more loans for homes in foreclosure than any other bank in America as of February, at more than 96,000. In all, these properties had more than $23 billion in mortgage debt, and 60% of them were seriously underwater. The bank’s purchase of mortgage lender Countrywide Financial has been especially criticized. As of mid-2012, the acquisition was believed to have cost Bank of America over $40 billion. According to Mortgage Daily, the bank is taking a step back in both mortgage lending and servicing. In 2012, it cut the amount of mortgage loans it originated from $156.1 billion to $78.7 billion, while cutting its mortgage servicing operations by 21%. <a href="" target="_blank"> Read More At 24/7 Wall St. </a>