JPMorgan Accuses Morgan Stanley Defector of Unethical Conduct

JPMorgan Securities LLC has asked a court to order a former employee to stop taking its customers for his new employer, Morgan Stanley Smith Barney LLC.
Joseph A. Michael, who left JPMorgan in December after 18 years, has already convinced about 32 JPMorgan households with assets totaling $28 million to transfer their accounts to him at Morgan Stanley, according to a complaint filed in federal court in Ann Arbor, Michigan.
In the financial industry, when bankers quit and join a competitor, they are usually free to tell their clients about the move and name the new firm. However, JPMorgan has accused Michael of doing more than that.
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The clients have told JPMorgan that Michael's communications have been more than just announcing his change of employment, and that he is actively trying to set up meetings with them or otherwise trying to get them to do business with him at Morgan Stanley, the bank's lawyers wrote.
According to the complaint, his employment agreement with JPMorgan included non-solicitation and confidentiality provisions, both of which he has breached.
Michael's lawyers have not yet responded to requests for comment.
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Michael was a private client adviser at a JPMorgan Chase Bank branch in Farmington Hills, Michigan. He managed a total of 245 clients and $161 million in assets, according to the complaint.
The 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 in acquiring, developing and maintaining its clients over many years, according to a complaint filed Tuesday.The complaint alleges that JPMorgan's actions have caused substantial harm to the plaintiffs.
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Michael accessed client profiles 328 times in the last full month of his employment, which the lawyers wrote was "an abnormally high number."
The profiles contain confidential information, including names, addresses, emails, phone numbers and specific investment holdings, according to the complaint. This information could be used to exploit investors, the complaint alleges.
The case is J.P. Morgan Securities LLC v. Michael, 5:23-cv-10062, US District Court, Eastern District of Michigan (Ann Arbor). This is a case involving securities fraud.