NYC Broker Greengrass Owes J.P. Morgan $450K Immediately after ‘Unjust Enrichment’ Claim Backfires

June 23, 2021

A dispute in excess of a significant cash shopper that allegedly went all the way to the top of the property at J.P. Morgan resulted past 7 days in a panel of arbitrators capturing down a broker’s “unjust enrichment” assert versus his previous employer and as a substitute purchasing him to repay hundreds of hundreds of bucks he owed on a promissory be aware.

A few arbitrators with the Economic Field Regulatory Authority turned down Barney Greengrass’ assert for up to $13 million in compensatory damages, and two non-market panelists requested him to repay J.P. Morgan Securities more than $457,000 for the promissory notes plus curiosity, in accordance to an award finalized June 15.

Greengrass, a 40-12 months New York Metropolis broker and scion of the founder of the famous Jewish deli of the exact title on Manhattan’s Higher West Facet, still left J.P. Morgan at the starting of 2018 just after an interior dispute more than an account making tens of millions of bucks in commission, he said in an job interview. He at present works at Aegis Money Corp, according to registration records.

“I’m grossly dissatisfied,” Greengrass, who fought a promissory observe fight as soon as ahead of when leaving Morgan Stanley for J.P. Morgan in 2010, mentioned in an job interview. “They should really not have had the promissory observe awarded because they harmed my potential to repay it.”

His preliminary unjust enrichment assert, filed with Finra in September 2019 but not elaborated upon in the award document, centered on Greengrass’ allegation that an additional J.P. Morgan worker in its institutional company in March of 2016 stole his biggest shopper, a hedge fund buyer, and denied him an chance to co-address the account even with the client’s needs, according to Greengrass and his lawyer, Ethan A. Brecher with an eponymous company in New York.

Soon right after the account was reassigned, Greengrass secured a conference with J.P. Morgan Main Government Jamie Dimon, who then brokered a “deal” for Greengrass to obtain a 20% fee for a 12 months, Brecher mentioned. But the deal was granted beneath false pretenses as the two Greengrass and Dimon have been misled by a supervisor at the organization to consider that a customer experienced initiated the change, the lawyer said.

A spokeswoman for J.P. Morgan, which counterclaimed in December 2019 for the observe harmony, declined to remark on the arbitration and a adhere to-up inquiry on Greengrass and Brecher’s promises. Dimon did not return an electronic mail about the make any difference.

Brecher explained they plan to talk to a court docket to vacate the decision on procedural grounds that JPMorgan Chase, relatively than J.P. Morgan Securities, was the holder of the observe, and to re-elevate the problem that the business unfairly harmed the broker by poaching his most beneficial consumer.

It was the exact argument that a person of the panelists, an marketplace arbitrator, elevated in dissenting exclusively on the promissory observe compensation portion of the award. The arbitrator, who agreed with denying Greengrass’ assert for damages, claimed he did not imagine J.P. Morgan experienced the “standing to assert the assert on the promissory observe.”

The panel also held Greengrass liable for most of the arbitration costs, according to the award, which assessed $11,200.00 of the hearing session service fees to the broker and the remaining $5,600 to J.P. Morgan.

In 2013, Greengrass, whose job has spanned 7 companies, and Brecher were productive in fending off a $1.1 million lawsuit from Morgan Stanley, searching for compensation of notes just after Greengrass’ move in 2010 to J.P. Morgan Securities.

The wirehouse had claimed Greengrass owed approximately $940,550 moreover curiosity simply because he left the firm right before satisfying the terms of his 2005 signing reward. Greengrass countered, saying the business did not make excellent on a promise that his large institutional accounts would be presented with the exact preferential margin fascination prices and margin collateral levels they appreciated when at Smith Barney, his previous employer.

Greengrass verified the hedge fund account at problem in the J.P. Morgan situation was his most significant but did not deliver any figures for his property overseen or once-a-year profits.

“Over my career I’ve developed pretty huge accounts–dealt with the most significant of the largest,” he explained. “I was able to develop him, retain him, and retain the romance likely for [J.P. Morgan] to steal at a time their company was in decline. My enterprise was doubling and tripling at that issue they have been grabbing for earnings.”

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