September 13, 2024 General

Berger Montague Cash Sweeps Lawsuits Gain National Attention in the American Banker

In a recent article in American Banker, Berger Montague was featured as one of the law firms at the forefront of recent litigation against cash sweep programs. These programs, lawsuits allege, benefit financial institutions’ bottom line rather than clients. While many wealth managers defend the programs by arguing that moving uninvested cash into low-interest accounts ensures the cash is protected by the FDIC, which guarantees protection up to $250,000 in individual accounts, lawsuits claim that investors have lost billions of dollars on uninvested cash that they assumed would be ‘swept’ into higher-interest accounts.

The article examines recent lawsuits filed against JPMorgan, Wells Fargo, and Ameriprise, all of which Berger Montague is involved in. Berger Montague filed a class action lawsuit against JPMorgan with co-counsel Rosca Scarlato on behalf of lead plaintiff Dan Bodea in the U.S. District Court for the Southern District of New York. The case is Dan Bodea v. JPMorgan Chase & Co., et al., No. 1:24-cv-06404. Berger Montague’s Michael Dell’Angelo, Andrew D. Abramowitz, and Alex B. Heller are working on the case. The Firm also recently filed the following cash sweep class action lawsuits: Bujold v. Wells Fargo & Co., et al., No. 24-cv-04616 (N.D. Cal.), Peters v. LPL Financial LLC, No. 3:24-cv-01228 (S.D. Cal.) and Bender v. Ameriprise Financial, Inc., et al., No. 24-cv-03359 (D. Minn.)

The American Banker article quotes Berger Montague’s complaint against JPMorgan, in which JPMorgan is referred to acting as a “double agent” by claiming to serve clients while moving their cash into low-interest accounts without clients’ knowledge to benefit JPMorgan and their affiliated companies instead. The suit alleges that JPMorgan has breached its fiduciary duty by failing to put clients’ best interests first.

To learn more about Berger Montague’s cash sweeps cases or to participate in the litigation, contact Alex Heller at [email protected] or (215) 875-4032 or Andrew Abramowitz at [email protected] or (215) 875-3015.

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