“Defendant’s misconduct is highly disruptive to JPMorgan’s ability to conduct business in a stable manner and to maintain JPMorgan’s goodwill with its clients,” the filing stated. “Unless [Chamberlain's] misconduct is immediately restrained and enjoined, other competitors of JPMorgan will be encouraged to engage in the same kind of improper behavior with complete impunity, the result of which will inflict severe and permanent damages on JPMorgan.”
In its lawsuit against Armstrong and Arikat, the firm alleged that following their June 15 resignations, the couple started soliciting their J.P. Morgan clients to join them in their new venture at Wells Fargo.
Both had started their J.P. Morgan careers on the Chase side of the firm. Arikat had spent six years dually registered at Charles Schwab and one year at Merrill Lynch before joining Chase in 2010, according to BrokerCheck. Armstrong joined Chase as a broker in 2007, becoming dually registered in 2009, according to BrokerCheck.
Wells Fargo recruited them with about $6 million in financial inducements, according to the lawsuit.
In addition, the filing claimed, they worked in two Scottsdale, Ariz., branches of J.P. Morgan Chase as private client advisors along with three other investment professionals—Catherine Esparza, who is dually registered and joined Chase in 2012; Michael Rosson, a broker who joined Chase in 2007; and Beth Michele, an investment associate who joined Chase in 2007 and at one time was a registered broker, according to BrokerCheck. All three resigned at the same time as Armstrong and Arikat and are working at the same office for Wells Fargo, the lawsuit said.
J.P. Morgan’s suit said the team has brought about 80 J.P. Morgan clients with assets under management of $95 million to Wells Fargo.
The Forbes Best In-State Women Advisors 2022 list for Arizona put Arikat's assets under management at $529 million.
Attempts to reach the advisors and Ameriprise were unsuccessful. A Wells Fargo spokesperson would only say that the firm was happy to have Armstrong and Arikat aboard, and a J.P. Morgan spokesperson declined to comment.
Both of the lawsuits followed a strategic pattern on J.P. Morgan’s part, where “private client advisors” who work in bank branches are described as receiving all of their client leads as assignments from the firm.
“[They] sat at their desks at the JPMorgan Chase bank branch they were assigned to and were introduced to hundreds of existing bank clients (with or without investment accounts) to offer and provide access to investment opportunities through Chase Wealth Management,” the lawsuits said. “As Private Client Advisors, [they] were not expected to engage in cold calling or attempt to build a client base independent of referrals from JPMorgan.”