Ex-JPMorgan executive who fled to Argentina pleads guilty in U.S | Reuters - Firstpost
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Ex-JPMorgan executive who fled to Argentina pleads guilty in U.S | Reuters

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By Nate Raymond
| NEW YORK

NEW YORK A former JPMorgan Chase & Co (JPM.N) executive who spent eight years on the run in Argentina pleaded guilty on Friday to U.S. charges that he embezzled $5.4 million from clients at the bank and at a prior employer, UBS AG.Hernan Arbizu, who became involved in a tax-evasion probe involving JPMorgan, pleaded guilty in Manhattan federal court to charges including wire fraud and embezzlement. He was extradited in June from Argentina."I knew what I was doing was wrong," he said in court. "I'm very sorry and am ashamed by my actions."The 48-year-old citizen of Argentina faces a mandatory-minimum two-year prison sentence and a maximum of 422 years. But under a plea agreement, Arbizu agreed to cooperate with prosecutors, which his lawyer, Guy Lewis, said could help him avoid further prison. What that cooperation entails, Lewis said, "remains to be seen."

JPMorgan declined to comment on Friday.Arbizu was first indicted in 2008, the same year he was fired by JPMorgan, where he was a vice president in its private banking division. He worked at UBS from 2002 to 2006.While at JPMorgan, Arbizu oversaw more than $200 million of client assets and was responsible for managing relationships with high-net-worth Argentine customers, according to the bank.

Prosecutors said that from March 2007 to April 2008, Arbizu initiated 12 wire transfers from clients at UBS and JPMorgan totalling nearly $5.38 million, about half of which came from a single JPMorgan account.In lawsuits JPMorgan filed against Arbizu in 2008 and 2009, the bank said he wired the $2.8 million to an account at UBS to conceal the millions of dollars that he had previously stolen from one of its customers.

JPMorgan said that after it discovered evidence of the wire transfers, Arbizu, then living in Connecticut, fled to Argentina, taking with him confidential data on clients.That data later became the basis of a tax evasion investigation and raid by Argentina authorities of JPMorgan's office in Buenos Aires in 2008 after Arbizu handed over a list of customers. No case against JPMorgan appears to have resulted.The case is U.S. v. Arbizu, U.S. District Court, Southern District of New York, No. 08-cr-615. (Reporting by Nate Raymond in New York; Editing by Steve Orlofsky)

This story has not been edited by Firstpost staff and is generated by auto-feed.

First Published On : Nov 19, 2016 06:30 IST

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