New York Life is a defendant in a new California lawsuit alleging that a former longtime agent engaged in a Ponzi scheme.

Abidog v. New York Life Insurance Co. was filed in California Superior Court on June 18, seeking damages and alleging that a Ponzi scheme that deprived elderly and other unwitting investors of their life savings. The filing was first reported by the law site JD Supra.

Plaintiffs allege that Felix Chu, as a New York Life agent, lured them into investing life insurance proceeds, retirement funds, and other assets in the purchase of unregistered promissory notes.

Chu, who has 24 years experience with New York Life, was barred from the industry by the Financial Industry Regulatory Authority.

Plaintiffs claim Chu coaxed then to purchase New York Life insurance policies and to borrow money from these policies to invest further in the notes. Each of these notes were issued by Felix Chu, his son Derek Chu, or entities they controlled.

The…

Read more…