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JPMorgan, NY, federal government in $13 billion settlement

JPMorgan Chase has reached a record $13 billion settlement with federal and state authorities to resolve claims over the bank's sales of mortgage-backed securities that collapsed during the U.S. housing crisis.

It is the largest settlement ever between the Department of Justice and a corporation, and marks a key chapter for the crisis. But the deal does not affect an ongoing criminal probe.

The settlement announced Tuesday requires JPMorgan to pay $9 billion and provide $4 billion in consumer relief, including principal reductions and other mortgage modifications for homeowners facing foreclosure.

The bank said it committed to completing all of those consumer measures by the end of 2017.

New York Attorney General Eric Schneiderman, who sued JPMorgan in 2012, says the state will get $613 million in cash and about $400 million in relief for struggling homeowners.

A settlement has been expected for weeks but was held up repeatedly by disputes, including the tax deductibility of the deal and whether the bank would be absolved of criminal liability.

The on-again, off-again talks were seen at risk of collapse late last month but got back on track a few weeks ago.

At one point JPMorgan CEO Jamie Dimon went to the Justice Department to negotiate personally with Attorney General Eric Holder.

Last week the bank also agreed to a separate, $4.5 billion, settlement with mortgage investors.

—CNBC's Max Gorden contributed to this report.

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