Michael Oppenheim, an ex-JPMorgan Chase (JPM) investment adviser, was arrested this week and charged with bilking clients of at least $20 million. Oppenheim worked for the firm from 2002 until March of this year.
Authorities claim that starting as early as 2011, Oppenheim convinced clients to allow him to take money out of their accounts to invest in low-risk municipal bonds. Instead, he allegedly used the funds to get cashier’s checks that he put into brokerage accounts that he controlled. He also used the money to trade options and stocks in different companies.
Because his options trading activities were generally unprofitable, most of his investments lead to losses. By last year he’d lost some $13.5 million. Oppenheim was also purportedly using client money to pay for a home loan and cover bills. He is accused of concealing his embezzelment by using fraudulent client statements and transferring funds among his clients.
Meantime, the U.S Securities and Exchange Commission has filed a parallel claim against the New York-based financial adviser. The regulator says that Oppenheim abused his role as a private client advisor, promising customers that he would put their funds in secure and safe investments but instead using the money to aggressively play the market in stocks that belonged to him.
The SEC is accusing Oppenheim of numerous violations, including those involving the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940. It wants penalties, disgorgement, and an injunction.
Contact our investment adviser fraud law firm today.
Ex-JPMorgan banker charged with taking $20 million from clients, Reuters, April 16, 2015
SEC Says Bank VP Swiped $20 Million From Clients, Courthouse News Service, April 16, 2015
Read the SEC Complaint (PDF)
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