J.P. Morgan Accuses Advisor Of Improperly Transferring Clients to Morgan Stanley in His Transition

Posted on January 25th, 2023 at 2:10 PM
J.P. Morgan Accuses Advisor Of Improperly Transferring Clients to Morgan Stanley in His Transition

From the Desk of Jim Eccleston at Eccleston Law.

J.P. Morgan has asked a court for a temporary injunction to stop a former advisor from transferring clients during his transition to his new firm, Morgan Stanley.

J.P. Morgan alleges that a former advisor, Joseph Michael, improperly persuaded at least 32 J.P. Morgan clients to transfer their accounts to him at Morgan Stanley. According to J.P. Morgan’s complaint, the accounts held assets totaling nearly $28 million. “The clients have informed JPMorgan that Michael’s communications have been more than simply announcing his change of employment, and that he is actively requesting meetings with the clients or otherwise seeking to induce them to do business with him at Morgan Stanley”, according to J.P. Morgan.

In addition to purportedly breaching his non-solicitation agreement, J.P. Morgan alleges that Michael breached confidentiality provisions that were included in his employment agreement with the firm. J.P. Morgan’s investigation allegedly determined that Michael had suspiciously accessed client profiles about 328 times in his last full month of employment. The client profiles contain a swath of confidential information, including names, addresses, email addresses, and phone numbers.

The case is yet another example of how important it is to understand the law and any enforceable contractual restrictions in planning a successful transition.

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, advisors, law

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