March 8, 2016 / 11:03 PM / 4 years ago

UPDATE 1-Ex-JPMorgan adviser gets 5 years' prison for embezzling $20 mln

(Adds comments by ex-adviser at court hearing)

By Nate Raymond

NEW YORK, March 8 (Reuters) - A former JPMorgan Chase & Co investment adviser was sentenced to five years in prison on Tuesday after admitting that he stole at least $20 million from client accounts to fund a gambling addiction and to trade in stock options.

Michael Oppenheim, 49, was also ordered by U.S. District Judge Analisa Torres to forfeit almost $20.2 million and pay restitution to JPMorgan after pleading guilty in November to charges of embezzlement and securities fraud.

In court, Oppenheim said he was horrified by his conduct, which led him to steal a “mind-boggling” sum. But he sought mercy from the court, saying his actions stemmed from his gambling addition, “a destructive disease.”

“I wish I had stopped or sought help, but I kept going,” he said.

According to U.S. prosecutors and securities regulators, Oppenheim worked with about 500 wealthy clients as a vice president and private client adviser in JPMorgan’s midtown Manhattan offices.

Prosecutors said that from 2008 to 2015, Oppenheim persuaded clients to let him withdraw some of their money, in some cases millions of dollars, falsely claiming he would invest it in low-risk municipal bonds.

In other cases, Oppenheim, who lived in Livingston, New Jersey, simply took their money without permission, prosecutors said.

In court papers, Oppenheim’s lawyer, Paul Shechtman, had urged Torres to be lenient in sentencing, saying his client’s crime, while serious, was fueled by a “pathological gambling addiction that has haunted him for much of his adult life.”

But Torres said while she recognized his gambling addiction drove the conduct, his offense was serious, and mitigating factors “do not alleviate the need for punishment.”

At the time of Oppenheim’s arrest in April 2015, JPMorgan issued a statement saying it had alerted U.S. authorities, noting that it was “angry that this person violated the trust our clients place in us.”

The case is U.S. v. Oppenheim, U.S. District Court, Southern District of New York, No. 15-cr-548. (Reporting by Nate Raymond in New York; Editing by Chris Reese and Matthew Lewis)

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