NY attorney general names new investor-protection chief

Wed Oct 16, 2013 5:20pm EDT
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By Karen Freifeld

NEW YORK Oct 16 (Reuters) - New York Attorney General Eric Schneiderman on Wednesday named a new chief for his office's Investor Protection Bureau, which is probing abuses by Wall Street banks in the sale of mortgage-backed securities before the financial crisis.

Chad Johnson, 46, a veteran securities lawyer who joined the attorney general's office last year, replaces Marc Minor, who resigned after holding the position from March 2011 through August.

In recent weeks, Johnson has represented the New York attorney general in negotiations with JPMorgan Chase & Co over government mortgage probes, according to a person familiar with those negotiations who is not authorized to speak publicly about the matter.

The discussions also include the U.S. Department of Justice, Securities and Exchange Commission and Department of Housing and Urban Development.

New York's participation stems from Schneiderman's appointment as co-chair of a working group formed by President Barack Obama in January 2012 to investigate misconduct in mortgage securities that contributed to the financial crisis.

Schneiderman brought the 11working group's first lawsuit last October, suing JPMorgan in state court over alleged improper sales of pools of home loans by Bear Stearns in 2006 and 2007.

His Investor Protection Bureau brought a similar lawsuit against Credit Suisse Group AG in November.

In an interview on Wednesday, Johnson declined to comment on the negotiations with JPMorgan.   Continued...