JP Morgan Off Hook to Ponzi Scheme Investor After Settlement

JP Morgan Chase & Co.'s settlement with a billion-dollar Ponzi scheme’s bankruptcy receiver and a related order prohibiting creditors from seeking additional funds are sound, the Eighth Circuit said Friday.

The decision limits JP Morgan’s payout to the amount of its $2.5 million settlement and affirms a lower court’s approval of the receiver’s accounting, defeating a challenge by investment firm Ritchie Capital Management LLC.

The appeals court’s ruling is the latest in sprawling litigation over a massive fraud perpetrated by Thomas Petters, who was convicted and sentenced to 50 years in prison. Ritchie, a victim of the fraud along with ...