JP Morgan Securities, Former Brokers Ordered to Pay $19 Million for Senior Investment Fraud
A Financial Industry Regulatory Authority (FINRA) arbitration panel recently awarded $19 million to a 94-year-old investor based on findings of abuse of fiduciary duty, fraudulent misrepresentations, and elder financial fraud. The investor, Beverly Schottenstein, filed claims against JP Morgan Securities and two of its now-former brokers who – notably – were the investor’s grandchildren.
As FINRA attorney Jake Zamansky explains, arbitration cases involving senior investment fraud have become increasingly prevalent in recent years. “While this case is particularly unfortunate because of the familial relationship between the parties involved, the allegations themselves are not uncommon.” FINRA and the U.S. Securities and Exchange Commission (SEC) routinely issue warnings regarding senior investment fraud—including the types of fraud perpetrated against Ms. Schottenstein.
Red Flags Lead to Discovery of Multiple Forms of Investment Fraud and Elder Financial Abuse
As reported by Bloomberg, Ms. Schottenstein discovered the fraud perpetrated by JP Morgan Securities and her two grandsons after obtaining an independent review of her accounts. The review clearly demonstrated multiple forms of investment fraud and elder financial abuse which had taken place for years. Among the issues uncovered were:
- Excessive commissions
- Risk investments that hadn’t been disclosed
- Missing account statements
- Other missing documents
- Unexplained credit card charges
According to Bloomberg, after several months of Zoom hearings and testimony, a FINRA arbitration panel, “issued a swift decision in [Ms. Schottenstein’s] favor.”
While much of the misconduct at issue involved Ms. Schottenstein’s grandsons, she pursued fraud claims directly against JP Morgan Securities as well. As Bloomberg reports, “she alleged the bank reaped millions of dollars in commissions by moving her money in and out of investments inappropriate for a nonagenarian, while failing to supervise her grandsons and ignoring signs she was being financially exploited for almost five years.” Bloomberg also reports that FINRA is continuing to investigate the allegations for possible enforcement action.
What To Do in Circumstances of Senior Investment Fraud and Elder Financial Abuse
When faced with concerns of possible senior investment fraud or elder financial abuse, the best thing you can do is to speak up. In this case, Ms. Schottenstein did exactly the right thing in order to protect herself. She got help reviewing suspicious activity in her brokerage accounts, and she took legal action promptly once she discovered that she had been victimized.
Unfortunately, senior investment fraud and elder financial abuse are issues that are not going to go away. Unscrupulous brokers and scam artists view wealthy seniors as easy targets. But, by being as careful as possible, and by taking legal action when necessary, seniors can protect their hard-earned wealth and hold bad actors accountable.
Schedule an Appointment with FINRA Attorney Jake Zamansky
If you have concerns about possible senior investment fraud or elder financial abuse, we encourage you to seek help promptly. At Zamansky LLC, we represent senior investors nationwide. To schedule a confidential consultation with FINRA attorney Jake Zamansky, call us at 212-742-1414 or tell us how we can reach you online today.