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SEC drops lawsuit against executive in financial crisis case

Nov 19 2012 Reuters

The U.S. Securities and Exchange Commission has dropped its civil lawsuit against a former executive of GSC Capital Corp who was accused of negligence for helping mislead investors on a JPMorgan Chase & Co mortgage-bond deal. The SEC's decision to drop the case against Edward Steffelin, a former managing director at GSC Capital Corp, was disclosed in a court filing Friday in U.S. District Court in Manhattan. "Our duty in all cases is to achieve a just and appropriate outcome," SEC spokesman John Nester said. "Our decision here appropriately reflects information that came to light as the litigation progressed." Steffelin was the sole individual charged when JPMorgan agreed to a $153.6 million civil settlement last year and one of the few people hit with a SEC lawsuit related to pre-recession mortgage investments gone bad. Steffelin had been in charge of a team at GSC that selected the investment portfolio for a $1.1 billion collateralized debt obligation called Squared CDO 2007-1,

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