Jefferies Group, the investment bank owned by Leucadia National Corp., said it agreed to pay $25 million as part of a settlement with regulators into suspected abuses in trading of mortgage-backed securities.

The deal includes a non-prosecution agreement with the U.S. Attorney's Office in Connecticut, according to a regulatory filing today from New York-based Jefferies. It requires $11 million in payments to counterparties harmed by the trades, a fine of about $10 million to the U.S. Attorney's Office and $4 million to the Securities and Exchange Commission, subject to approval by the agency's commissioners.

The investigation "arose from a matter that came to light in late 2011, at which time we terminated a mortgage-backed securities trader who was then indicted" in January of last year, Jefferies said in today's filing.

Jesse Litvak, who was fired by the bank, was arrested that month on charges of securities fraud for allegedly lying about the origins and prices of debt. He's pleaded not guilty.

The bank recognized $23.2 million of costs tied to the case in the fourth quarter of fiscal 2013, according to the filing.

John Nester, a spokesman for the SEC, declined to comment. Thomas Carson, a spokesman for the U.S. Attorney's Office in Hartford, Connecticut, didn't immediately return a call for comment. Richard Khaleel of Jefferies couldn't immediately be reached for comment.

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