Articles Tagged with JP MORGAN

Stoltmann Law Offices, a Chicago-based investment and securities fraud law firm, has been prosecuting claims on behalf of burned investors against banks and brokerage firms since 2005.  We have seen it all; from the Tech Wreck, where investors were torched by the advice to put their entire retirement funds into NASDAQ darlings; to the Financial Crisis where Wall Street engineers manufactured every sort of derivative possible to off load their risk onto the accounts of retirees and investors alike. Now, as interest rates rise, inflation grips the economy, and the market waivers, the old adage that some things never change, is prescient.

For the last decade, big banks like JP Morgan Chase, RBC, and Bank of America-Merrill Lynch have been creating “structured notes” and selling them to their clients by the billions. These “notes”, they claim, offer an investor some of the upside of owning a company’s stock or an index, and some of the perks of a fixed income investment. Now, the common-sense response to this would be, no, I’ll just invest in preferred stock, or traded-REITs if I want income with growth potential. But Wall Street’s salesmen and their masters dress-up these incredibly complicated and conflicted “notes” and pump them up with grandeur and promise.

One specific investment that has fallen on particularly hard times right now is the:

Stoltmann Law Offices represents investors that were sold high-risk structured products. FINRA, the federal securities industry regulator, fined J.P. Morgan $200,000 for “failing to reasonably supervise a broker who made unsuitable, unauthorized trades in his grandmother’s account with the firm,” according to

From March 2014 through March 2019, Evan Schottenstein, along with his brother, Avi Schottenstein, another broker at Morgan, “allegedly made the trades in question, which were largely in structured products, according to FINRA. During that period, Evan Schottenstein was responsible for his grandmother’s investment strategy and made all trade recommendations for her account, FINRA said. At the time, the grandmother was 88 years old, retired and widowed.

“Evan Schottenstein filled his grandmother’s account with structured products, exceeding his firm’s limits for such investments,” FINRA stated. “The firm used an ‘exception report’ that generated monthly alerts when structured products exceeded a 50% threshold for a client’s net account equity and a 15% threshold for a client’s liquid net worth,” FINRA noted.

Stoltmann Law Offices is investigating brokers who have failed to protect customers’ personal information from identity theft. The Securities and Exchange Commission (SEC) has separately charged J.P. Morgan Securities, UBS Financial Services and TradeStation Securities, for “deficiencies in their programs to prevent customer identity theft, in violation of the SEC’s Identity Theft Red Flags Rule, or Regulation S-ID.”

 “From at least January 2017 to October 2019, the firms’ identity theft prevention programs did not include reasonable policies and procedures to identify relevant red flags of identity theft in connection with customer accounts or to incorporate those red flags into their programs. In addition, the SEC’s orders find that the firms’ programs did not include reasonable policies and procedures to respond appropriately to detected identity theft red flags, or to ensure that the programs were updated periodically to reflect changes in identity theft risks to customers.”

“Regulation S-ID is designed to help protect investors from the risks of identity theft,” said Carolyn Welshhans, Acting Chief of the SEC Enforcement Division’s Crypto Assets and Cyber Unit. The agency’s actions “are reminders that broker-dealers and investment advisers must design and operate identity theft prevention programs that are appropriately tailored to their businesses and update them in response to the increased threat and changing nature of identity theft.”

Chicago-based Stoltmann Law Offices represents investors who’ve suffered losses from dealing with broker-advisors who’ve placed clients in unsuitable investments.

FINRA, the federal securities regulator, has ordered JP Morgan to pay an investor $4 million for “unsuitable securities — including high-risk equities and junk bonds –without authorization,” according to The JPM client also alleged a JP Morgan broker had “used leverage to increase the bets in her portfolio, including high-risk foreign currency positions.”

The broker on the accounts appears to be Edward L. Turley, Advisorhub reported. Morgan fired Turley, a “star” broker who reportedly generated as much as $30 million in revenue on $1.6 billion in assets, in August. He has $57 million in pending damage claims from four customer complaints on his record tied to losses sustained in last year’s pandemic-triggered market crash, excluding the award in the most recent case.

Chicago-based Stoltmann Law Offices has represented investors who’ve suffered investment losses at the hands of financial and investment advisers who churned and burned their accounts. One of the most prevalent abuses in the securities industry is excessive trading, or “churning” client accounts. This practice, which is forbidden by industry regulators like FINRA and the SEC, is done to generate commissions, almost always at the expense of the client. As the stock market swings wildly during the Covid-19 pandemic, brokers take advantage by trading their clients’ accounts to generate commissions.

Brokers can open the door to churning by asking customers if they want an “active” trading strategy, which gives brokers discretionary ability to trade at will. Unless clients give specific directions on how and when to trade, brokers may take the opportunity to trade excessively and charge needlessly high commissions.

Churning has been the subject of numerous regulatory actions over several decades. Broker Frank Venturelli, a representative for First Standard in Red Bank, New Jersey, was cited by FINRA for excessive trading between 2016 and 2018. According to FINRA settlement, clients lost more than $373,000 during that period. Venturelli was suspended from the industry for 11 months and ordered to pay partial restitution of $30,000 to his clients.

AdobeStock_78306447-1-300x199Ameriprise can be held liable for investment losses with former broker Nicholas Hoetmer in the Financial Industry Regulatory Authority (FINRA) arbitration forum on a contingency fee basis. Nicholas Hoetmer was previously registered with JP Morgan in Indianapolis, Indiana from 2012 until 2016, Chase Investment Services in Indianapolis from 2005 until 2012 and Banc One Securities Corp in Chicago, Illinois from 1999 until 2005. In May 2018, FINRA sanctioned Hoetmer following allegations that he failed to amend his Form U4. He was terminated from JP Morgan following allegations he failed to disclose a reportable event on his Form U4, and, while registered with Chase Investment Services Corp, recommended an unsuitable investment and misrepresented material facts related to an investment in auction rate securities. These are all against securities laws and internal firm rules. Nicholas Hoetmer, according to online records, has two customer disputes against him, one regulatory matter, one financial and two criminal dispositions. He is not currently registered as a broker and has been suspended from the industry.

AdobeStock_123495998-1-300x197Please call our law firm today for a no-cost review if you wish to file a whistleblower claim against JP Morgan, and were a former or are a current employee of the firm. The type of activity the SEC is most interested in, includes brokers who materially mislead investors so that they make buying and selling decisions concerning stocks that they might not have made, had they been fully and accurately informed. It also includes specific sales abuses engaged in by JP Morgan or brokers with the firm. If a JP Morgan employee submits a tip to the SEC that is original, voluntary, and results in sanctions worth more than $1,000,000, the whistleblower could be rewarded between 10 and 30 percent of the fines collected. In some cases, whistleblowers have been awarded millions of dollars for their contribution to the SEC investigation.
In February of this year, a former JP Morgan paid $30 million to a whistleblower who asked to not be identified. The award was the Commodity Futures Trading Commission’s (CFTC) fifth highest whistleblower award, since eclipsing a $10 million one in 2016. It is the CFTC’s second in excess of $1 million. The case alleged that JP Morgan did not properly disclose that it was steering asset-management customers into investments that would be profitable for the bank.
We have sued JP Morgan multiple times in FINRA arbitration claims. If you wish to report unethical conduct at JP Morgan and seek to make a whistleblower claim, please call our law firm today.

AdobeStock_17723177-1-300x175According to a recent Letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA), Pavel Shklyar was accused of violating industry rules and regulations. FINRA was investigating Shklyar for his participation in potential private securities transactions, and he did not provide requested documents to FINRA. This resulted in an automatic bar from the industry. Previously, Pavel Shklyar was registered with Josephthal & Co., Bernard L. Madoff, Credit Suisse, Salomon Smith Barney, ICAP/Investment Services and Trading, RBC Professional Trader Group, Merrill Lynch and J.P. Morgan in Norwood, New Jersey from January 2015 until February 2018. He is not currently registered as a broker and was barred from the industry, according to his online, public records with FINRA. If you or someone you know lost money with Mr. Shklyar and would like to bring a claim against J.P. Morgan for your losses, please call us today to find out how to do so on a contingency fee basis in the FINRA arbitration forum.

AdobeStock_82110313-1-300x125According to Compliance Week, the Financial Industry Regulatory Authority (FINRA) fined J.P. Morgan Securities $1.25 million for failing to conduct timely or adequate background checks on 8,600 of its non-registered employees. This was 95% of its non-registered employees. According to federal securities laws, broker-dealers must fingerprint employees “working in a non-registered capacity who may present a risk to customers based on their positions. Fingerprinting helps firms identify if a person has been convicted of crimes that would disqualify them from being associated with a firm, absent explicit regulatory approval. Federal banking laws require banks to conduct similar checks on banking employees using a more limited list of disqualifying events.” Allegedly, from January 2009 until May 2017, J.P. Morgan did not fingerprint approximately 2,000 of its non-registered employees in a timely manner. This is against securities laws and internal firm rules.

AdobeStock_123495998-1-300x197According to a recent Letter of Acceptance, Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA), Todd Jones, a former broker with J.P. Morgan was accused of exercising discretion without written authority in the accounts of 12 firm customers and mismarked most of the trades as unsolicited. This is against securities laws and firm rules. Mr. Jones was fined $15,000 and suspended from the industry for four months. According to FINRA, Jones was previously registered with Sanford C. Bernstein & Co. in Seattle, Washington from June 2011 until December 2014, Merrill Lynch in Seattle from December 2013 until November 2014 and J.P. Morgan Securities in Seattle from December 2014 until October 2015. He has been suspended and is not currently registered within the industry.

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