The Post reports that J.P. Morgan will make a $722 million settlement to end a matter involving the firm’s efforts to seek bond business from Jefferson County, Alabama.

The Securities and Exchange Commission said Wednesday that J.P. Morgan and former managing directors Charles E. LeCroy and Douglas W. MacFaddin paid $8 million to friends of Jefferson County commissioners who voted to hire the bank to carry out municipal bond offerings and other transactions to finance a new sewer system. The friends worked for local financial firms, but did not work on the deal.

The SEC release is here.

J.P. Morgan Securities settled the SEC’s charges and will pay a penalty of $25 million, make a payment of $50 million to Jefferson County, and forfeit more than $647 million in claimed termination fees.

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According to the SEC’s complaint filed against LeCroy and McFaddin in U.S. District Court for the Northern District of Alabama, the two former managing directors demonstrated in taped telephone conversations that they knew the payments to local firms with ties to county commissioners were designed to obtain business for J.P. Morgan’s broker-dealer and affiliated bank. LeCroy and MacFaddin referred to the payments as “payoffs,” “giving away free money,” and “the price of doing business.”

The SEC alleges that the scheme began in July 2002, when LeCroy and MacFaddin solicited Jefferson County on behalf of J.P. Morgan Securities for a $1.4 billion sewer bond deal. LeCroy and MacFaddin knew several county commissioners wanted to complete the transaction before November, when two commissioners would leave office and lose their ability to funnel payments to their supporters’ firms. LeCroy later boasted to MacFaddin in a taped telephone conversation about his efforts to persuade the two commissioners to select J.P. Morgan Securities for the deal, beating out a rival firm. LeCroy told MacFaddin that he said to the commissioners, “Whatever you want — if that’s what you need, that’s what you get — just tell us how much.”