‘Not an Objective’

After the regulators’ request, JPMorgan Chief Financial Officer Marianne Lake said that an internal investigation of the bank’s sales practices had turned up sporadic problems, which she didn’t identify, but no systemic lapses. During an October earnings call with investors, she said: “Cross-sell is an outcome. It’s not an objective.”

The seven bankers, who worked at J.P. Morgan Private Bank from three years to well over a decade, said the rhythm of the workday made their office feel more like a hard-charging sales operation than a buttoned-up private bank.

Each morning the bankers in Manhattan would file into the 24th-floor conference area, senior managers in the first row, private bankers behind and stragglers standing. People at dozens of other offices around the country would call in.

Morning Huddle

The morning meeting opened with a market overview and often shifted to a discussion of specific products such as structured notes, mutual funds and private equity funds offered by JPMorgan or an outside company that gives the bank a financial incentive to sell. (JPMorgan has disclosed that certain companies pay fees back to the bank in exchange for the placements.) Later, smaller teams met for a morning “huddle” to discuss their sales targets and strategies.

Oduyoye described the meeting as educational rather than sales-driven, focusing on market events. “We take pride in the amount of time we spend educating our advisers on markets and solutions -- internally or externally -- so they can better serve their clients,” Oduyoye said.

The advisers were encouraged to offer “managed solutions” to clients, several of the former employees said. These accounts let clients set their own investment objective, like growth. Customers pay a management fee. Portfolio managers pick the products and make the trades. The bank prefers in-house products, from which it earns additional fees, the bank recently disclosed to clients of its managed products.

Many days ended with “the 4:45” -- a gathering often attended by executives from JPMorgan’s partners, including the Blackstone Group and Starwood Capital, who pitched their own new products and discussed how to sell them, according to six of the former employees. Among the hedge funds offered in the private bank’s managed portfolios, all but one shared fees with JPMorgan, the Securities and Exchange Commission said in December 2015.

Blackstone declined to comment. Starwood didn’t respond to a request for comment.