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Bloomberg
JPMorgan Securities LLC asked a court to order one of its former employees to stop poaching its customers for his new employer, Morgan Stanley Smith Barney LLC.
Joseph A Michael, who quit in December after more than 18 years at JPMorgan, has already persuaded about 32 JPMorgan households, with assets totalling about $28 million, to start transferring their accounts to him at Morgan Stanley, according to a complaint filed in federal court in Ann Arbor, Michigan.
Generally in the financial industry, when bankers quit and join a competitor, they’re free to tell their clients they did so, and name the firm. But JPMorgan says Michael did more than that.
“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,†JPMorgan’s lawyers wrote.
His employment agreement with JPMorgan included non-solicitation and confidentiality provisions, both of which he has breached, according to the complaint.
Michael was a private client adviser at a JPMorgan Chase Bank branch in Farmington Hills, Michigan. He had about 245 clients with approximately $161 million in total assets under management, according to the complaint.
Michael also engaged in suspicious computer activity before quitting, accessing client profiles about 328 times in the last full month of his employment — “an abnormally high number,†the lawyers wrote.
The profiles contain confidential information, including names, addresses, emails, phone numbers and specific investment holdings, according to the complaint.
The substantial majority of Michael’s clients were reassigned to him, and had been long-term Chase Bank clients, the bank’s lawyers said.
“JPMorgan has invested substantial time and money, totaling millions of dollars, to acquire, develop and maintain its clients over many years,†the lawyers wrote in the complaint.