JPMorgan seeks to limit Peregrine trustee's subpoena power

CHICAGO Tue Aug 7, 2012 1:55am IST

Stocks

   

CHICAGO Aug 6 (Reuters) - JPMorgan Chase & Co on Monday sought to limit the power the bankruptcy trustee for Peregrine Financial Group has to subpoena information from financial institutions that did business with the failed brokerage.

JPMorgan said in a court filing that Trustee Ira Bodenstein's request for authorization from a bankruptcy court to serve subpoenas on financial information may be overly burdensome by encompassing Peregrine's affiliates and wholly owned subsidiaries, in addition to the brokerage itself.

JPMorgan reserved the right to "modify or quash" subpoenas that are too burdensome or broad.

Bodenstein last week asked the court for the authority to require 10 financial institutions, including JPMorgan, to produce information about open and closed accounts maintained by Peregrine, its affiliates and subsidiaries.

Peregrine, which maintained various accounts at JPMorgan, filed for bankruptcy protection on July 10, one day after CEO Russell Wasendorf Sr attempted suicide and left a note describing how he had bilked customers of more than $100 million over nearly 20 years.

Wasendorf said he had forged and intercepted financial statements that were mailed between U.S. Bank, where some Peregrine customer money was held, and the firm's auditors at the National Futures Association.

Bodenstein said in an interview on Monday that his request to serve subpoenas was "pretty standard," and JPMorgan said in the filing that it did not object to the court granting him the general authority to issue subpoenas upon the bank.

However, JPMorgan said the "conditions upon which the trustee seeks to conduct the proposed examination are anything but 'routine.'"

JPMorgan also objected to Bodenstein's request that the bankruptcy court prohibit subpoenaed financial institutions from recouping any costs incurred with providing documents.

A federal judge in Chicago is set to consider Bodenstein's request for subpoena authority on Tuesday.

  • Most Popular
  • Most Shared