Senior Customer of Ex-NYLIFE Securities Broker Felix Chu Seeks Over $5M in Ponzi Scam Losses

Barred Stockbroker is Accused of Running Ponzi Scam That Defrauded Elderly Investors

Felix S. Chu, a former NYLIFE Securities registered representative, is currently facing at least two customer disputes in which the claimants are seeking $5,230,000 in damages. Chu was barred by the Financial Industry Regulatory Authority (FINRA) last year. He has been accused of running a Ponzi scam involving promissory notes that defrauded investors, including seniors.  

Shepherd Smith Edwards and Kantas (SSEK Law Firm at is investigating claims of losses by former investors of ex-NYLIFE Securities financial advisor, Felix Chu. If you are one of these investors, call (800) 259-9010 today.

Investment Fraud Claims Involving Chu Was From Claimants Who Suffered Promissory Note Losses

According to his BrokerCheck record, Chu was registered with NYLIFE Securities the entire 24 years he was in the industry until 2019. FINRA barred him last year after he failed to cooperate in the SRO’s probe into customer allegations accusing the ex-NYLIFE Securities broker of promissory note sales violations. 

In fact, the four customer disputes noted to date on Chu’s record are related to promissory notes, including:  

  • 5/2021: These plaintiffs contend that they were persuaded to open up a retirement account in which they placed at least $75K. They also took out $70K to invest in a promissory note and opened up a joint bank account. They claim that money was taken out, they loaned money and were never paid back. They are requesting $230K in damages.
  • 4/2021: Alleging violation of the California Elder Abuse Act, negligence, misrepresentations, breach of fiduciary duty, fraud, and breach of contract, this older customer is seeking $5M in damages.
  • 10/2019: This claimant contends that she and her husband were misled into buying $305K of promissory notes. They also said that they wrote a check for $75K that they were misled into thinking was for more insurance. This investor fraud claim was settled for $125K.
  • 8/2019: Alleging promissory note fraud, this FINRA arbitration case was concluded with a $250K settlement.

Felix Chu and His Son Accused of Promissory Note-Related Ponzi Scam 

Felix Chu has been accused of recommending that customers invest in a Ponzi scam involving promissory notes so that he could earn high commissions and income for himself. His son Derek Chu, also a former NYLIFE Securities broker, has been accused of involvement in this scheme. 

FINRA barred Derek from the industry in 2015 a few months after the broker-dealer fired him. According to BrokerCheck, a customer dispute involving promissory notes that named Derek Chu was brought in 2019 and is still pending. The claimant is seeking nearly $837K in damages.

This alleged Ponzi-like scam involving promissory notes involving Felix Chu and his son appears to have involved Felix promoting the latter’s purportedly successful sports ticket resale business. He touted the venture as safe and likely to generate 15% yearly returns. Their victims then invested in promissory notes issued by Derek Chu. 

Unfortunately,  investors’ money appears to have been used to pay other investors’ interest and principal payments in a Ponzi-like fashion. The money also was allegedly used to fund the Chus’ lavish lifestyle.

Skilled FINRA Arbitration Lawyers

NYLIFE Securities has been accused of failing to properly supervise and not conducting any due diligence to make sure that these promissory notes were legitimate and safe investments for its customers.  SSEK Law Firm represents investors in pursuing damages from their financial advisors and broker-dealers through FINRA arbitration. Contact us today and request a free case consultation.

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