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UNITED STATES OF AMERICA
BEFORE THE
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
WASHINGTON, DC
In the Matter of
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1
M
A
~ T.~STROMGREN
W
) Docket No. 05-017-B-I
05-017-E-I
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1
A Former Institution-Affiliated Party of
J.P. MORGAN CHASE & CO.
New York, New York
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Order of Prohibition and Order
to Cease and Desist Issued
Upon Consent Pursuant to the
Federal Deposit Insurance Act,
as Amended
1
WHEREAS, pursuant to sections 8(b)(6), (e)and (i)(3) of the Federal Deposit
Insurance Act, as amended (12 U.S.C. 1818(b)(6), (e) and (i)(3)) (the "the FDI Act"), the
Board of Governors of the Federal Reserve System (the "Board of Governors") issues
this consent Order of Prohibition and Order to Cease and Desist (the "Order") against
Matthew T. Stromgren ("Stromgren"), a former employee and institution-affiliated party,
as defined in section 3(u) of the FDI Act (12 U.S.C. 1813(u)), of J.P. Morgan Chase
& Co., New York, New York ("Chase"), relating to Stromgren's alleged violations of
law and breaches of his fiduciary duty to Chase and its customers in connection with his
embezzlement of $3 1,000 for his personal use; and
WHEREAS, Chase was a state member bank at the time of the events that gave
rise to the issuance of this Order and at the time of Stromgren's resignation from Chase;
and
WHEREAS, by affixing his signature hereunder, Stromgren has consented to the
issuance of this Order by the Board of Governors and has consented to comply with each
and every provision of this Order, and has waived any and all rights he might have
pursuant to 12 U.S.C. 1818 or 12 C.F.R. Part 263, or otherwise (a) to the issuance of a
notice of intent to prohibit on any matter set forth in this Order; (b) to a hearing for the
purpose of taking evidence with respect to any matter implied or set forth in this Order;
(c) to obtain judicial review of this Order or any provision hereof; and (d) to challenge or
contest in any matter the basis, issuance, validity, terms, effectiveness, or enforceability
of this Order or any provision hereof;
NOW, THEREFORE, prior to the taking of any testimony or adjudication of or
finding on any issue of fact or law implied or set forth herein, and without this Order
constituting an admission by Stromgren of any allegation made or implied by the Board of
Governors in connection with this proceeding, and solely for the purpose of settlement of
this matter without protracted or extended hearings or testimony:
IT IS HEREBY ORDERED, pursuant to sections 8(b)(6) and 8(e) of the FDI Act
(12 U.S.C. 1818(b)(6) and (e)), that:
Restitution
1.
On or before the effective date of this Order, Stromgren shall make
restitution to the Bank in the sum of $31,000.00 for its losses as a result of Stromgren7s
violations and breaches.
Prohibition from Banking
2.
Stromgren, without the prior written approval of the Board of Governors,
and, where necessary pursuant to section 8(e)(7)(B) of the FDI Act, (12 U.S.C.
1818(e)(7)(B)),the appropriate Federal financial institutions regulatory agency, is hereby
and henceforth prohibited:
(a) from participating in any manner in the conduct of the affairs of any
institution or agency specified in section 8(e)(7)(A) of the FDI Act, (12 U.S.C.
1818(e)(7)(A)),including, but not limited to, any depository institution or any depository
institution holding company;
(b) from soliciting, procuring, transferring, attempting to transfer, voting or
attempting to vote any proxy, consent, or authorization with respect to any voting rights in
any institution described in section 8(e)(7)(A) of the FDI Act;
(c) from violating any voting agreement previously approved by any
Federal banking agency; or
(d) from voting for a director, or serving or acting as an institutionaffiliated party, such as an officer, director, or employee in any institution described in
section 8(e)(7)(A) of the FDI Act.
3.
All communications regarding this Order shall be addressed to:
(a)
Ms. Sarah J. Dahlgren
Senior Vice President
Federal Reserve Bank of New York
33 Liberty Street
New York, NY 10045
and a copy to:
4.
(b)
Tonya Jenerette, Esq.
Legal Department
Federal Reserve Bank of New York
33 Liberty Street
New York, NY 10045
(c)
Peter J. Kelley, Esq.
36 East 20th Street
6th Floor
New York, NY 10003
Any violation of this Order shall separately subject Stromgren to
appropriate civil or criminal penalties or both under sections 8(i) and (j) of the FDI Act
(12 U.S.C. 1818(b)(i) and (j)).
5.
The provisions of this Order shall not bar, estop, or otherwise prevent the
Board of Governors, or any federal or state agency or department from taking any other
action affecting Stromgren, provided, however, that the Board of Governors shall not take
any further action relating to the matters set forth herein.
6.
Each provision of this Order shall remain effective and enforceable until
stayed, modified, terminated, or suspended in writing by the Board of Governors.
By order of the Board of Governors of the Federal Reserve System, effective
i k
t h i A F : day of June, 2005.
BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM
By:
~ a t t h &T. Stromgren
C/
Secretary of t h e ~ o a r d