Former JPMorgan executive accused of embezzlement

By Martha Graybow

NEW YORK (Reuters) - A former JPMorgan Chase & Co private banking executive has been indicted on charges of embezzling about $5.4 million, according to federal court papers.

The indictment, filed in U.S. District Court in Manhattan, accuses former executive Hernan Arbizu of 15 criminal counts. Arbizu was arrested on Monday in Argentina, according to a person close to the matter who spoke on condition of anonymity.

The indictment contends Arbizu engaged in a scheme to withdraw funds from bank customers without their knowledge through the use of unauthorized wire transfers. The U.S. government is also seeking the forfeiture of the roughly $5.4 million it contends was embezzled.

The name of Arbizu's attorney was not immediately available.

JPMorgan said in a statement that it "appreciates the cooperation and the prompt joint action of the Argentine and American authorities. However, the firm is unable to comment further due to pending litigation."

Last month, the investment bank's JP Morgan Securities unit sued Arbizu, accusing him of sharing sensitive information with other firms. The court papers in that case said Arbizu had lived in Connecticut while employed by JPMorgan, but fled to Argentina before being fired in June.

Arbizu had been responsible for handling business involving high-net-worth individuals in Argentina and Chile for JPMorgan, the lawsuit said.

(Reporting by Martha Graybow, editing by Gerald E. McCormick, Dave Zimmerman and Lisa Von Ahn)