FINRA fined former Stifel, Nicolaus & Co. Inc and LPL Financial LLC broker Kevin Luby for failing to disclose outside business activities he engaged in on behalf of an elderly customer. The report states that Luby acted as successor co-trustee of the elderly client's trust and a co-personal representative of her estate while helping to manage certain rental properties without disclosing any of these activities to Stifel, LPL, or FINRA.
According to the findings, Luby first began assisting his senior client at Stifel with management of a few investment properties in 2009, at which time the elderly client also named Luby as co-successor trustee of her trust and co-personal representative of her estate.
At the time, Luby allegedly failed to disclose the outside business activity in multiple compliance questionnaires, and again did not disclose these activities and involvement upon transferring to LPL in 2012.
The investigation states that as beneficiary, Luby would stand to receive $650,000 from his elderly client's brokerage account at LPL in addition to three investment properties valued at $123,000.
When the customer died, Luby purportedly attempted to act as successor co-trustee and co-personal representative, unaware that his client had since amended her trust and removed Luby as co-trustee and representative; he eventually withdrew his petition.
By failing to disclose his involvement with the rental properties and additional fiduciary appointments with his elderly client, Luby violated multiple FINRA rules put in place to protect investors by making financial activities transparent, such as those which could cause conflict of interest scenarios, suffer from miscommunication, and those that would benefit from certain industry protections and safeguards.
If you have invested with Kevin Luby or with any broker or financial adviser whose outside business activities—such as trust and estate planning services rendered outside of one's scope of employment and not reported to an employing firm—and such involvement has proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for investigation and consultation.