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Securities Arbitration Firm Investigates JPM Chase Investment Arm

Friday, July, 20, 2012


It looks like JP Morgan Chase's consumer investment arms—JP Morgan Chase Proprietary Mutual Fund and Chase Strategic Portfolios—are coming under scrutiny by a securities arbitration law firm.

 

The firm, Klaymman & Toskes, P.A., made it public on Wednesday that it is looking into the investment & banking giant's sales practices of mutual funds and portfolios, on behalf of investors.


JP Morgan Chase Giving Bad Financial Advice?

 

The New York Times recently reported that financial advisors for the firm were at times told to favor JP Morgan's own products--even when competitor's products had been performing better, or represented a less sizable investment.

 

While it is only natural to put one's best foot forward, many people feel that JP Morgan Chase went beyond doing just that. And the people who feel that way are not ones you should scoff at.


If Scrutiny from A Financial Arbitration Firm Wasn't Bad Enough

 

Private practice and private investors aren't the only ones eying the banking and brokerage giant. Several regulatory agencies have decided to find out more about the company's sales practices.

 

Among these agencies are the Financial Industry Regulatory Authority (FINRA), an independent yet powerful commission.

 

What should really make the company decide to straighten up any dirty laundry is the interest of the SEC, also known as the Securities and Exchange Commission. That's one government agency to whom no one enjoys explaining themselves.


What was Wrong with the Firm's Securities?

 

Fund researcher and news source Morningstar claims that, for the last 36 months, over 40% of Morgan's funds did not beat the average performance of other funds making similar investments.

 

All the same, the company repeatedly promoted these funds, This is the major reason the securities law firm, as well as the SEC and FINRA, are looking into the company's practices and corporate culture.