JPMorgan Says Felony Plea Shouldn't Bar LightSquared Stakeby
Character of airwaves license holders scrutinized by FCC
Bank paid $1.8 billion fine and pled guilty to market rigging
JPMorgan Chase & Co. says its felony plea for market rigging shouldn’t bar it from owning part of LightSquared Inc., a satellite company emerging from bankruptcy and trying again to set up a mobile broadband service.
JPMorgan “possesses the requisite character” demanded by the Federal Communications Commission for holders of airwaves licenses, the largest U.S. bank by assets said in an Oct. 6 filing at the agency. JPMorgan said it was responding to questions from FCC staff.
JPMorgan and other banks in May agreed to plead guilty to felony charges of conspiring to manipulate the price of U.S. dollars and euros.
JPMorgan has paid fines totaling more than $1.8 billion and is strengthening internal controls to prevent a recurrence, the bank said in the FCC filing prepared by Wiley Rein LLP, a Washington law firm. The violation wasn’t related to the communications industry and thus isn’t potentially disqualifying, JPMorgan said.
LightSquared, formed by investor Philip Falcone in 2010, filed for bankruptcy in 2012 after the U.S. blocked its plan to convert airwaves originally designated for satellite service to spectrum for land-based radio towers. Users of the global positioning system, including the U.S. military and navigation gear maker Trimble Navigation Ltd., said LightSquared’s use would cause interference.
LightSquared won approval for its exit financing in June, and now it wants the FCC to approve transferring spectrum licenses to its new owners: JPMorgan, Fortress Investment Group LLC and Centerbridge Partners LP.
LightSquared also will still need FCC approval to operate its wireless network.
Brian Marchiony, for JPMorgan, and Ashley Durmer, for LightSquared, declined to comment.