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J.P. Morgan seeks to vacate $1.4 million FINRA defamation award for former advisor

On Behalf of | Mar 21, 2022 | Firm Transition

J.P. Morgan Securities is taking legal action after losing an arbitration case against one of its former advisors who filed a defamation claim, reports AdvisorHub.

On March 7, J.P. Morgan filed a motion in federal court in Kentucky asking that a Financial Industry Regulatory Authority arbitration ruling be overturned, alleging that the panel had disregarded the law and exceeded its powers.

Last month, a FINRA panel of arbitrators ordered J.P. Morgan to pay $1.4 million to Dustin B. Luckett following his allegation that defamatory information had been entered on his form U5 after he was terminated in 2017. Luckett, a former private client advisor in Louisville, Kentucky, was also authorized to expunge the termination notice from his record.

Following Luckett’s termination, J.P. Morgan alleged that he had a co-worker notarize a document without having the signing customer present, and had attempted to retaliate against the manager who had reported him.

In ruling in Luckett’s favor, the FINRA arbitrat­ion panel determined that J.P. Morgan’s allegations were defamatory and that the explanation for his termination be amended because of the nature of the information.

J.P. Morgan is now requesting a stay of Luckett’s attempt to confirm the award, and the motion means the company will not have to pay the award immediately. Luckett’s attorney said they will oppose the motion by J.P. Morgan, saying there are not grounds to vacate the award.

FINRA’s Form U5 tracks, among other things, the employment history of registered representatives and the circumstances surrounding why a registered representee’s registration with a firm terminated. An inaccurate filing threatens your career in the financial services industry and may permanently put you at a disadvantage when seeking future opportunities.  If you are concerned that you may be, or if you already have been, terminated from your firm, or if you believe you have inaccurate information on your Form U5, contact us at  (888) 655 6002 or through our online contact form to schedule a free consultation.