Dropbox co-founder Arash Ferdowsi just filed a $225 million lawsuit against JPMorgan Chase, accusing the financial giant of mismanaging his investment portfolio and squandering hundreds of millions of dollars.
The suit alleges JPMorgan Private Wealth Advisors steered Ferdowsi into “complex, low-performing” investments with exorbitant fees, causing over $225 million in damages.
Specifically, Ferdowsi claims JPMorgan advisor Arif Ahmed placed him in Market-Linked Investments (MLIs) instead of better alternatives, hammering him with embedded fees that were fifteen times higher than what was agreed upon.
“These investments were selected for no legitimate investment purpose, but rather because they allowed JPM Wealth to extract over $40 million in hidden fees that it then shared with Ahmed…
To make matters worse, Ahmed compounded his rent-seeking strategy by churning Ferdowsi’s account, recommending unnecessarily early and frequent trades.
Each of these trades lined Ahmed’s and JPM Wealth’s pockets with further fees while causing ever-increasing harm to Ferdowsi’s portfolio.”
According to the lawsuit, Ferdowsi discovered the improper fees in December of 2023 and confronted Ahmed.
Soon after, JPMorgan allegedly told Ferdowsi without any explanation that he had a matter of weeks to close all of his investment accounts before they would be liquidated.
The alleged mismanagement and improper investments happened at JPMorgan Chase and at First Republic Bank, which JPM acquired in May of 2023.
Ferdowsi is asking to pursue arbitration through the Financial Industry Regulatory Authority (FINRA) without any interference related to the acquisition.
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