A former JPMorgan Chase & Co. broker faces federal charges that he stole $20 million from customers, only to lose at least $13.5 million in bets on Tesla Motors Inc., Apple Inc. and other companies.
Michael Oppenheim induced clients to withdraw hundreds of thousands or even millions of dollars from their accounts by promising he’d invest the money in low-risk municipal bonds to be held at the bank, FBI Special Agent Matthew Taylor said in a criminal complaint in Manhattan federal court.
Instead, Oppenheim pocketed the cash or invested it in companies including Tesla, Google Inc. and Netflix Inc., the Securities and Exchange Commission said in a related civil lawsuit.
“Soon after each deposit, Oppenheim typically lost the entire amount,” the SEC said.
Oppenheim, who was fired by the bank last month, was arrested Thursday on fraud and embezzlement charges at his home in Livingston, New Jersey, and later released on a $1 million bond by a federal magistrate judge in New York. At one point, he had about 500 clients and almost $90 million under his management, according to the criminal complaint.
“He’s going to plead not guilty,” Oppenheim’s attorney, Robert Gamburg, said after court.
The thefts began in March 2011 and lasted for four years, the FBI said. Oppenheim, 48, also used the money to pay personal bills including a home loan, according to the Federal Bureau of Investigation’s complaint.
In some instances, “Oppenheim simply withdrew hundreds of thousands of dollars from clients’ accounts without their knowledge,” Taylor said.
The FBI’s criminal complaint doesn’t provide details on Oppenheim’s alleged investments.
“We are sorry and angry this happened,” Michael Fusco, a spokesman for the New York-based bank, said in an e-mailed statement. “We always stand by our customers and will ensure no customer who had their money stolen will lose any funds related to this.”