CHICAGO (CN) - An attorney claims Chase Bank helped freeze him out of his law firm by conspiring to put all the firm's assets under his former partner's control.
Eric Freed, formerly of Freed & Weiss LLC, sued JPMorgan Chase, but not his former partner, nor the firm, in Cook County Court.
Freed claims the partnership agreement of Freed & Weiss entitled him to 53 percent of the LLC's profits, and his former partner Paul Weiss to 47 percent. He says Weiss voluntarily quit the LLC. Weiss is married to Jamie Saltzman Weiss, also an attorney, and not a party to the case.
Freed claims: "As early as 2008, Weiss and Saltzman devised and agreed on a fraudulent scheme to wrongfully eliminate Freed from the LLC. Once put in motion, this fraudulent scheme would allow Weiss, Saltzman, and perhaps others, to take over the business and finances, move the LLC's bank accounts from Bank of America - where they were officially maintained - to another bank - where Freed would have no signatory authority, and freeze Freed out of the LLC's operations, by preventing Freed from accessing the LLC's premises and computer system."
Freed claims that in December 2008 and in October 2009, Saltzman and Weiss opened bank accounts with Chase Bank, claiming that Weiss was the only member of the LLC.
"Chase Bank failed to undertake, on information and belief, any due diligence to ascertain the veracity of these statements. Indeed, the simplest of investigations would have revealed their falsity," the complaint states.
It adds: "Chase Bank assisted Salzman and Weiss in opening these bank accounts at Chase Bank, account numbers *4054 and *5990, and, upon information and belief, without conducting any due diligence whatsoever - but, regardless, manifestly inadequate due diligence - therefore egregiously violating and recklessly disregarding the 'know your customer rule.' A simple review of the Partnership Agreement for Freed & Weiss LLC, and/or the filings that were made by Freed & Weiss LLC with the Illinois Secretary of State, that were publicly available online at that time, would have shown the falsity of the representations made by Saltzman and Weiss."
In March 2011, Freed claims, "Weiss moved virtually all of the LLC's funds from its official Bank of America account to the Chase Bank accounts that Weiss and Saltzman had, with Chase Bank's assistance, fraudulently opened beginning in December 2008."
Freed says he sent Chase Bank a letter demanding it freeze the LLC's account.
But according to the complaint: "Rather than freezing the Chase Bank accounts as directed by Freed, Rebecca Gray, ('Gray') a private client banker of Chase Bank, with full knowledge of the correspondence dated November 28, 2011, telephoned Weiss and Saltzman, told them of Freed's correspondence, informed them that the funds would likely be frozen, and aided and abetted Weiss and Saltzman in the removal of the LLC's funds from Chase Bank. Weiss, acting on Gray's advice and direction, immediately obtained a cashier's check for $750,000 from Chase Bank and moved the LLC's funds to another financial institution to which Freed had no access. ...
"The same Chase Bank officer, Gray, then e-mailed Weiss on December 13, 2011, offering to help him move additional funds out of the Chase Bank accounts, which were to arrive later, to another account to which Freed had no access."
Gray is not a party to the complaint. The only defendant is JP Morgan Chase & Co.
Freed seeks more than $1 million in damages, plus punitive damages, for conspiracy to commit fraud, and intentional interference with contract.
He is represented by Daniel Voelker.
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