JPMorgan Chase, the trillion-dollar lender, has been ordered by the Financial Industry Regulatory Authority (FINRA) to compensate a former employee, Michael C. Nolan, for defamation. Nolan, a former financial advisor at JPMorgan Securities, claimed that his reputation was tarnished when the bank filed a Form U5 to FINRA after his departure in 2022.
Under FINRA regulations, member organizations are required to submit a Form U5 explaining the reasons for an individual’s departure. In JPMorgan’s Form U5, it alleged that Nolan had violated company policy by sharing sensitive information with a client. The bank accused him of failing to disclose his personal affiliation with an outside business interest and violating the firm’s policy on the use of unapproved electronic communication channels for business communications.
Nolan, who had worked at JPMorgan for 41 years, denied the allegations and filed a dispute claim invoking FINRA Rule 1122, which prohibits financial institutions from providing misleading information about a registered advisor.
After more than a year of arbitration, FINRA has ruled in Nolan’s favor, awarding him $250,000 in compensatory damages. Additionally, JPMorgan has been instructed to remove all defamatory language and responses regarding Nolan from his Form U5.
JPMorgan Chase has incurred a total of $522.448 million in fines since 2000, imposed by US regulators, enforcement agencies, and lawsuits related to employment offenses, according to Violation Tracker, a comprehensive corporate misconduct database. Despite these fines, the bank recorded a profit of $49.6 billion last year.
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