The lawsuit alleged that ABFS had become insolvent in 2000, but made the impression it was still financially viable with the help of the Wall Street firms.

Bear Stearns, which is now part of JPMorgan Chase, was also named in the lawsuit.

George Miller, the ABFS’s bankruptcy trustee, was seeking at least $750 million from the banks on behalf of more than 20,000 people who lost their life savings when ABFS went bankrupt.

JPMorgan Chase paid $55 million on behalf of it and Bear Stearns to settle the case, while Credit Suisse paid out $37.5 million and Morgan Stanley $7.5 million.

The companies denied any wrongdoing.

Last month, changes to the Security and Exchange Commission’s investigations policies into Ponzi schemes were recommended after it missed Bernard Madoff’s $50 billion worldwide fraud for years.

JPMorgan Chase, Credit Suisse and Morgan Stanley pay $100m Ponzi fine is a post from: Before You Invest Your Money