Michael Oppenheim, who worked for the firm in New York, was arrested on 16 April and charged by the US Federal Bureau of Investigation (FBI) with wire fraud, embezzlement, and securities fraud, according to the Wall Street Journal.
He was fired by JP Morgan on 18 March.
Oppenheim allegedly stole between $300,000 and almost $2m from seven clients on at least 24 occasions between March 2011 and March 2015.
In some instances, he told clients he would invest their money in bonds, and then faked account statements showing the bond yields, according to the complaint filed by the FBI.
In other cases, he simply moved money out of clients’ accounts without their knowledge, the FBI said.
He used the clients’ money for his own trading in online accounts he held outside the bank and to pay his mortgage and other bills, according to the complaint.
Oppenheim apparently lost all the money he traded, given that ‘his brokerage accounts currently show minimal cash balances,’ the US regulator the Securities and Exchange Commission said.
The 48-year-old, who started his career as financial adviser in 1998 at Merrill Lynch, managed about $90m for about 500 clients, according to the complaint.
JP Morgan discovered the fraud and alerted the FBI, a bank spokesman told the Wall Street Journal.
“We are sorry and angry this happened,” he said. “We always stand by our customers and will ensure no customer who had their money stolen will lose any funds related to this.”
