J.P. Morgan Securities is searching for a short lived restraining order towards a former monetary advisor whom it accuses of stealing purchasers after transferring to Wells Fargo Advisors Monetary Community.
The grievance, filed in U.S. District Court docket for the Western District of Kentucky Owensboro Division on Friday, seeks to halt James A. Phelps Jr. of Newburgh, Ind., from soliciting JPMorgan’s purchasers, and from utilizing the corporate’s confidential and proprietary enterprise and shopper info.
The request for the non permanent restraining order and a preliminary injunction is “pending decision of an arbitration continuing between JPMorgan and Defendant that concurrently is being filed with [the Financial Industry Regulatory Authority], dispute decision,” the grievance mentioned.
The grievance mentioned that Phelps has already transferred eight JP Morgan households with property totaling about $3.6 million.
Phelps had been with JPMorgan Chase in Owensboro, Ky., since 2008 (he started with Chase Funding Providers Corp.), the grievance mentioned. He resigned on October 4 and instantly signed on with Wells Fargo Advisors Monetary Community (FiNet) in the identical city.
Phelps, who joined the Bluegrass Wealth Advisors FiNet group, didn’t reply to a request for remark.
The grievance mentioned that JP Morgan realized from purchasers that Phelps started making an attempt to recruit them after he joined Wells Fargo. The contacts included calls on their private cell telephones and emails to their private e mail addresses.
The grievance mentioned Phelps mailed “solicitation packets” to not less than 4 purchasers’ properties that contained paperwork together with a “marriage ceremony type” announcement of his becoming a member of Wells Fargo; a relationship abstract that supplied details about Wells Fargo; and a Wells Fargo doc titled “Regulation Finest Curiosity Disclosure” that defined the “scope and phrases of the brokerage companies … and detailed the fabric information regarding conflicts of curiosity that come up by way of our supply of brokerage companies to you.”
Three different purchasers, the grievance mentioned, mentioned that they acquired unsolicited emails from Phelps that included hyperlinks to “Kind CRS: Relationship Abstract” and the Wells Fargo doc titled “Regulation Finest Curiosity Disclosure.”
Phelps, the grievance mentioned, breached his employment settlement with JP Morgan, which partially “comprises provisions prohibiting him from soliciting JPMorgan purchasers for a interval of 1 12 months after his JPMorgan employment ends and from utilizing or retaining JPMorgan confidential info.”
The grievance mentioned that Phelps had 330 purchasers/households with about $109 million in property beneath administration, most of which had been both pre-existing on the time they had been assigned to him or had been referred to him by JPMorgan.
As a non-public shopper advisor, Phelps “was not anticipated to interact in chilly calling or try to construct a shopper base unbiased of referrals from JPMorgan,” the grievance mentioned.
A spokesperson for Nicely Fargo refused to remark.
Caroline Szyperski, a spokeswoman at JP Morgan, mentioned, “We do not have something so as to add.”
