National investor fraud law firm, KlaymanToskes (“KT”), has commenced an investigation (Felix Chu NYLife Securities Investigation) into former NYLife Securities broker Felix Chu in light of allegations of him running a Ponzi scheme involving promissory notes. Felix Chu was formerly registered out of NYLife’s Pleasant Hill, California branch location.
Felix Chu, Derek Chu, and Promissory Note Ponzi Scheme Allegations
Former customers of Felix Chu allege that the former NYLife broker recommended them to invest life insurance proceeds, retirement funds, and other assets in the purchase of unregistered promissory notes issued by Felix Chu and his son, Derek Chu, or entities under their control. Felix and Derek Chu stopped paying interest and principal on the notes, and investors suffered losses.
Both Felix Chu and his son, Derek Chu, are barred from the securities industry. For instance, on December 4, 2019, FINRA barred Felix Chu from the securities industry. FINRA barred Chu because he failed to request termination of his suspension within three months of the date of the notice of his suspension. On June 4, 2019, FINRA barred Derek Chu from the securities industry for refusing to produce documents and information to FINRA relating to his solicitation of investments and/or promissory notes.
Customer Disputes Against Felix Chu
According to BrokerCheck, there are four customer disputes to date appearing on Felix Chu’s record. Several of the customer disputes relate to promissory notes:
- May 2021. Plaintiffs allege that after April 2, 2018, they were induced to open a retirement account, into which they deposited at least $75,000.00 and subsequently withdrew $70,000.00 to invest in promissory notes. They were also induced to open a joint bank account, later realizing deposited funds were withdrawn. Plaintiffs also assert that they loaned money that was never repaid. The customer dispute is currently pending. The customers are claiming $230,000 in damages.
- April 2021. Chu was named in a customer complaint that asserted the following causes of action: breach of fiduciary duty; negligence; negligent misrepresentation; fraud; breach of contract – third party beneficiary; violation of Sections 10(b) and 20(a) of the Securities Exchange Act, and Rule 10b-5 of the Securities and Exchange Commission; violation of the California Securities Act; and Violation of the California Elder Abuse Act. The customers are complaining about mutual fund and/or municipal bond funds, and are claiming $5,000,000 in damages.
- October 2019. Customer alleges that, beginning in March 2016 until September 2018, she and her late husband were misled into purchasing promissory notes for a total of $305,000.00. Customer further alleges that they were misled into remitting a check for $75,000 to purchase what they believed to be additional insurance. Customers sought compensatory damages in excess of $380,000, lost income, interest, punitive damages and attorneys’ fees. The matter was settled for $125,000.
- August 2019. Customers allege that beginning in 2015, they were misled into purchasing promissory notes. Customer sought the return of principal, interest, punitive damages and attorneys’ fees. The matter settled for $250,000
Felix Chu NYLife Securities Investigation – Contact Us
Former customers of Felix Chu at NYLife Securities who suffered losses exceeding $250,000, and those who have information related to the handling of their investments, are encouraged to contact Lawrence L. Klayman, Esq., at (561) 542-5131, and download our Special Investor Report.
KT is a leading national securities law firm which practices exclusively in the field of securities arbitration on behalf of retail and institutional investors throughout the world in large and complex securities matters. KT has recovered more than $220 million for investors in FINRA arbitrations. KT has office locations in California, Florida, New York, and Puerto Rico.