CHASE INVESTMENT SERVICES CORP.

Permitted to Resign

AN INTERNAL INVESTIGATION FOUND EVIDENCE THAT REGISTERED REP SOLICITED AND PLACED TRADES FOR PRODUCTS THAT CISC DID NOT PERMIT ITS RRS TO SOLICIT, AND THEN MARKED THOSE TRADES AS UNSOLICITED; MAINTAINED MULTIPLE CLIENT FILES WITH DOCUMENTS CONTAINING FAXED OR PHOTOCOPIED CUSTOMER SIGNATURES THAT HE HAD SUBSEQUENTLY COMPLETED IN INK; FAILED TO OBTAIN HIS MANAGER'S SIGNATURE ON INCOMING CLIENT CORRESPONDENCE; AND FAILED TO SEEK HIS MANAGER'S APPROVAL BEFORE SENDING OUTGOING CLIENT CORRESPONDENCE.

AS A REGISTERED REP, I DID IN FACT PLACE TRADES AND MARKED SAME UNSOLICITED AS THEY WERE NOT ON THE APPROVED CISC LIST ON THAT PARTICULAR DAY. THE CLIENT HAD DISCUSSED AND REVIEWED DETAILS OF THESE PRODUCTS A WEEK OR SO PRIOR TO THE DAY CLIENT DECIDED TO INVEST AND THEREFORE, THEY WERE MARKED UNSOLICITED. FURTHER, THERE WAS ONE CLIENT WHOSE FILE CONTAINED A MODIFICATION IN INK AFTER THE FACT. HOWEVER, IT WAS WITH THE FULL APPROVAL OF THE CLIENT AND SUBSEQUENTLY, CLIENT SIGNED AND NOTARIZED AN AFFIDAVIT ATTESTING SAME. A COPY IS AVAILABLE UPON REQUEST. IN ADDITION, THERE WERE A COUPLE OF CORRESPONDENCES THAT WERE SET ASIDE FOR MANAGER'S INITIALS; HOWEVER, WHILE I WAS AWAY ON BUSINESS, THEY WERE FILED BY MY ASSISTANT AT THE TIME.

CLIENT ALLEGES MISREPRESENATION RELATING TO THE LIQUIDITY OF AN AUCTION RATE SECURITIES PURCHASE. DAMAGES ARE UNSPECIFIED.

$1,950,000.00

ON AUGUST 13 AND 14, 2008, JPMORGAN CHASE AGREED TO A SETTLEMENT IN PRINCIPLE WITH THE NEW YORK ATTORNEY GENERAL'S OFFICE, AND THE OFFICE OF FINANCIAL REGULATION FOR THE STATE OF FLORIDA AND THE NORTH AMERICAN SECURITIES ADMINISTRATORS ASSOCIATION TASK FORCE, RESPECTIVELY, WHICH PROVIDED, AMONG OTHER THINGS, THAT THE FIRM WOULD BUY BACK AT PAR CERTAIN AUCTION RATE SECURITIES. AS PART OF THESE SETTLEMENTS, JP MORGAN SECURITIES, INC., PURCHASED BACK THE ARS POSITION(S) AT PAR, IN ADDITION TO PAYING ACCRUED INTEREST ON THE PAR AMOUNT.

CUSTOMER ALLEGES UNSUITABILITY AND NON-DISCLOSURE OF FEES IN CONNECTION WITH THE PURCHASE OF A UIT.

$5,579.17