J.P. Morgan Securities is suing a former bank branch advisor who decamped for Kestra last fall, arguing he broke an agreement not to solicit the bank’s clients.
J.P. Morgan says Nader Joseph Al-Mooshi’s appeals to its clients have thus far bled the bank of $40 million in assets from about 64 households. Al-Mooshi reportedly worked with about 560 households with approximately $420 million in assets at the time of his departure from J.P. Morgan.
J.P. Morgan filed their complaint in Michigan federal court seeking a cease-and-desist and temporary restraining order.
Al-Mooshi joined J.P. Morgan in 2011 as a branch manager trainee, and became a branch manager in December of that year, according to J.P. Morgan’s complaint. In 2017, he became a financial advisor out of the bank’s Farmington, Mich. branch office. In 2018, he was promoted to a Private Client Advisor.
According to the bank, Al-Mooshi didn’t bring any clients with him when he joined the bank. While prior relationships can be carved out of non-solicitation agreements, Al-Mooshi didn't report any when he signed his agreements, according to the charges.
J.P. Morgan claims Al-Mooshi’s book of business was solely built by the bank's referrals to hundreds of existing customers. Al-Mooshi was “not expected” to cold call for clients or try to find a client base outside of J.P. Morgan’s referrals, according to his former employer.
“J.P. Morgan clients typically remain with and continue to be serviced by the firm, regardless of whether the Advisor or other team members resign or leave J.P. Morgan,” the complaint reads. Outside of his job, Al-Mooshi "would not have had any contact with the vast majority of the clients the firm assigned to him and whom he is now soliciting.”
Al-Mooshi had access to “extensive confidential financial records and information” about his clients, including their investment, trust and estate needs, which J.P. Morgan claims is “proprietary and valuable.”
The bank says that in the weeks before he left, Al-Mooshi accessed client and prospect profiles on J.P. Morgan’s Advisor Central Program 500 more times than he had in any previous month in the past year, often in quick succession and at odd hours of the day, intimating that he was copying client information.
After he left, there were no client of prospect files in his office, the bank charges. Bank officials learned that he often brought such documents home from the branch and despite requests he has not returned them, according to the bank.
One month after Al-Mooshi left for Kestra, J.P. Morgan alleges the advisor was contacting former clients, in some cases calling personal cell numbers, "often to clients who do not want to speak with him, and sometimes at night or on weekends," enticing them to join him at Kestra.
Al-Mooshi reportedly badmouthed his former employer and said he was more qualified than the advisors who replaced him, according to the charges.
Kestra said it would not comment on pending litigation. Attorneys for Al-Mooshi did not respond as of press time.
Though J.P. Morgan is a part of the Broker Protocol, those protections don't apply to advisors operating out of its bank branches, according to clarification the bank released in 2021, but only to registered reps in the J.P. Morgan Advisors business division with the titles “wealth advisor” or “wealth partners.”
Since that clarification, J.P. Morgan has continued to go after former advisors the bank claims are breaking non-solicitation vows; last October, the bank sued a Florida-based advisor who decamped to Commonwealth.