Former First Standard Financial Company broker Michael Leahy (CRD# 1899498) has been barred by the Financial Industry Regulatory Authority (FINRA)...Read More
Steve Lu: Ex-JP Morgan Broker Investigated and Barred by FINRA
Steve Lu (CRD# 6856088), previously a representative of JP Morgan in Altadena, California, has been sanctioned by the Financial Industry Regulatory Authority over allegations he improperly entered into a power-of-attorney relationship with an elderly retiree showing signs of dementia. He was barred from associating with FINRA member firms.
According to a Letter of Acceptance, Waiver and Consent (No. 2018058642601) dated April 2020, Steve Lu was associated with JP Morgan Chase Securities as an Investment Company and Variable Contracts Products Representatives from 2017 until his voluntary resignation in 2018, “while under internal review for accompanying an elderly customer to affiliate bank branches, allegedly attempting to open an affiliate bank account with the registered rep as a co-trustee and beneficiary on the account.” FINRA’s findings state that he had a “happenstance” meeting with “an 87-year old retiree living alone” on March 17, 2018, when she entered the bank branch where he worked, holding statements from her account at another bank, and asking to talk to someone about her account. She was not a customer of the firm or bank, FINRA states, and “was visibly confused when she met Lu.” FINRA alleges that instead of taking her to that other bank or otherwise helping her with the account, he met with a broker at JP Morgan Securities to discuss the movement of the customer’s investment accounts at an outside institution to their firm. He allegedly informed the other broker that she “was a close family friend who wanted to open an account and to name him as trustee on the account.” FINRA states the other broker “declined to open the account.”
Thereafter, according to FINRA, he took the retiree “to an attorney so she could execute documents giving him power over her financial affairs.” She entered into a “durable power of attorney” with him, and gave him “broad powers” to manage her affairs, as well as a provision that authorized him “to make gifts to himself of the greater of $5,000 or five percent” of her assets. FINRA states that she also entered into a trust agreement in which she and Lu were appointed as co-trustees, and in which she had the authority “to withdraw trust funds from any trust account,” as well as to inherit 75% of trust assets when the individual died.
According to FINRA, Lu attempted twice to open accounts for the individual’s trust at Chase, which would be under his control, and in attempting to open the accounts “made multiple misrepresentations” to employees of JP Morgan and Chase, informing brokers that the individual was “a close family friend” and “a good friend of his mother,” which FINRA states was false. He was eventually told by a supervisor to stop trying to open a trust account for the individual, and responded that he had received permission to open the account by a “Code of Conduct specialist.” FINRA states that his attempts “were escalated within Chase,” whose internal investigations group questioned him about his attempts, leading him to resign and refuse to answer any other questions. The group then reported his actions to state authorities, according to FINRA, who “appointed a guardian” for the individual and used legal action to revoke Lu’s power of attorney and the trust agreement. FINRA states that six months after she met Lu, the individual received a diagnosis of Alzheimer’s disease.
As a result of the foregoing alleged conduct, which FINRA states violated FINRA Rule 2010, Lu was barred from associating with any FINRA member firm.
Steve Lu is currently not registered as a broker or investment adviser. His previous registrations include JP Morgan in Altadena, California. He has passed three securities industry qualifying examinations and his BrokerCheck report lists zero state securities licenses. (Information current as of June 3, 2020.)