New York-based J.P. Morgan Securities filed for a restraining order against a former private client advisor who it claims has been soliciting clients to come over to his new firm.
J.P. Morgan yesterday accused John J. Mullarkey, a senior vice president and financial advisor at Morgan Stanley’s Oak Brook, Ill., office, of engaging in an ongoing campaign to persuade his former clients to join him at Morgan Stanley. J.P. Morgan made the claim in a filing requesting a temporary restraining order from the U.S. District Court for the Northern District of Illinois.
In its filing, J.P. Morgan made clear that it is also seeking relief and disciplinary action against Mullarkey via a claim filed with the Financial Industry Regulatory Authority.
J.P. Morgan said Mullarkey phoned more than a dozen of the firm's clients trying to get them to move their accounts and that, according to the clients, these calls went beyond simply announcing a change of employment.
In fact, J.P. Morgan alleges that Mullarkey is explicitly discussing account transfers with its clients, touting the different “opportunities and new and different products at Morgan Stanley,” according to the filing, in some cases contacting J.P. Morgan clients with “repeated and unwanted calls.”
Mullarkey once served about 290 J.P. Morgan clients with approximately $157 million in assets out of the firm’s Glen Ellyn, Ill., office. J.P. Morgan claims most of these clients had been with the firm before Mullarkey started working there.
The firm also alleges that he may have taken confidential client information with him to Morgan Stanley.
Thus far, J.P. Morgan says that approximately 13 of its clients, with assets totaling more than $18 million, have transferred their accounts to Mullarkey at Morgan Stanley.
In its filing, J.P. Morgan accuses him of breach of contract, misappropriation of trade secrets, breach of fiduciary duty, breach of duty of loyalty, intentional and negligent interference with actual and prospective economic advantages, conversion (his taking of trade secrets and other proprietary information), as well as unfair competition.
The restraining order would prevent Mullarkey from soliciting additional clients while J.P. Morgan’s case proceeds through Finra arbitration. J.P. Morgan also seeks a return of any records, documents or information he may possess pertaining to its clients, employees and business.
Mullarkey had not responded to Financial Advisor's attempts to seek comment as of the publication of this story.