The Commodities Futures Trading Commission (CFTC) is investigating J.P. Morgan for allegedly steering its private banking clients into its own hedge fund investment products. The regulatory body, along with other federal and state regulators, such as the Securities and Exchange Commission (SEC) is investigating whether JP Morgan made proper disclosures when directing its private banking clients into the hedge fund investments. The CFTC is looking into Highbridge Capital Management LLC, an investment firm owned by JP Morgan. The CFTC is looking into whether a high proportion of Highbridge’s assets come from JP Morgan’s private-bank assets and if that helped stabilize the hedge fund during the financial crisis. Banks are allowed to sell in-house investments, but advisors must adhere to the rules that require them to keep their client’s best interests in mind. This is called due diligence and if advisors do not do their due diligence, the firm can be held liable for investment losses. For funds such as Highbridge, a percentage of its funds that come from private bank client’s assets has decreased in performance.
If you invested money with JP Morgan, and would like to sue the firm for investment losses, please call our securities law firm based in Chicago, at 312-332-4200. We sue firms such as JP Morgan in the Financial Industry Regulatory Authority (FINRA) arbitration forum for not doing their due diligence. They can be held liable for financial losses.
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