J.P. Morgan Securities has filed for a temporary restraining order in a Nevada court to block a former advisor from allegedly taking clients to Wells Fargo Clearing Services.
According to the complaint, filed Tuesday in the U.S. District Court for the District of Nevada, Lorraine Calcote voluntarily resigned from JPMorgan on June 4 and immediately commenced employment with Wells Fargo Clearing Services LLC.
At the time of her resignation, Calcote was a private client advisor, working in a bank branch office of JPMorgan Chase Bank N.A., an affiliate of JPMorgan, in Las Vegas. She had been servicing approximately 269 households with about $206 million in total assets under supervision, according to the complaint.
The filing asks for a temporary restraining order and a preliminary injunction pending resolution of an arbitration proceeding between JPMorgan and Calcote that concurrently is being filed with the Financial Industry Regulatory Authority's Dispute Resolution unit.
"Calcote entered into an agreement with JPMorgan that contains post-employment restrictive covenants prohibiting her from soliciting JPMorgan’s clients for a period of one year after the termination of her employment, and requiring her to maintain the confidentiality of JPMorgan’s confidential and proprietary business and client information," the complaint states.
JPMorgan has learned, however, that since resigning from JPMorgan and joining Wells Fargo, Calcote is soliciting JPMorgan clients to move their accounts from JPMorgan to her at Wells Fargo — with approximately 13 JPMorgan households, with assets totaling in excess of $24 million, already have transferred their accounts to Calcote at Wells Fargo, according to the complaint.
Calcote is contacting JPMorgan clients, including calling clients on their personal cell phone numbers, seeking to induce such clients to transfer their business relationships from JPMorgan to her at Wells Fargo, the complaint states.
"The clients have informed JPMorgan that Calcote’s communications have been more than simply announcing her change of employment; she is actively requesting meetings with the clients or seeking to discuss Wells Fargo and moving the client relationships to her at Wells Fargo," the complaint contends.
Further, the complaint states that "Calcote took with her to Wells Fargo JPMorgan’s confidential client information, including client contact information, such as cell phone numbers, which, on information and belief, are generally not publicly available, without which she would have been unable to immediately commence calling and soliciting JPMorgan clients shortly after resigning from JPMorgan."
Calcote also engaged in "highly suspicious computer access on JPMorgan’s system in the two months prior to her resignation and accessed an unusually high number of client profiles on JPMorgan’s computer system off hours, many in rapid succession," according to the complaint.
The client profiles accessed by Calcote "contain highly confidential client information, including client names, addresses, e-mail addresses, phone numbers, and other information needed to solicit JPMorgan clients upon her resignation," the complaint states.
Wells Fargo declined to comment on the lawsuit.
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