Sonn Law Helps Secure $4M Award for Client of JP Morgan Broker Edward L. Turley

Sonn Law Group has helped secure a $4M award for our client – Lacey Winston Keath – who was a victim of unauthorized trading of unsuitable securities, including high-risk equities and junk bonds, by ex-JP Morgan broker Edward L. Turley.

The article below – which highlights an investment loss recovery result achieved by Sonn Law Group – was originally published by Jake Martin of the Advisor Hub in December 2021.

J.P. Morgan Advisors was ordered to pay $4 million in damages to a former client of a top-producer in San Francisco who has been beset by customer claims over last year’s pandemic-triggered market crash.

The Texas-based customer, Lacey Winston Keath, had alleged that J.P. Morgan’s traditional brokerage unit traded “unsuitable” securities–including high-risk equities and junk bonds–in her account without authorization, according to the Thursday-finalized Financial Industry Regulatory Authority award. She also alleged the unit had used leverage to increase the bets in her portfolio, including on high-risk foreign currency positions.

The total represented 80% of the $5 million in compensatory damages that Keath had sought in her May 2020 statement of claim.

A J.P. Morgan spokeswoman declined to comment on the arbitration outcome or underlying dispute.

The broker on the accounts appears to be Edward L. Turley, whose CRD record includes a summary of the complaint from Keath.

J.P. Morgan discharged Turley, who was said to have generated as much as $30 million in revenue on $1.6 billion in assets, in August. He has $57 million in pending damage claims from four customer complaints on his record tied to losses sustained in last year’s pandemic-triggered market crash, excluding the award in the Keath case.

Over the course of the arbitration, Keath had sought a total of $11.6 million at the arbitration hearings, including punitive damages, treble damages, expenses and attorneys’ fees plus $76,000 in expenses. The panel of three public arbitrators denied all claims other than the compensatory damage portion of the award.

A source familiar with the case said the more than $11 million in damages requested at the hearing represented “well-managed account” damages and that Keath’s “actual” losses came in under the $5 million initially requested.

J.P. Morgan in its July 2020 response denied Keath’s claims and in a counterclaim requested that the action be dismissed and that all forum fees be assessed to Keath. The firm had argued that Keath agreed to “indemnify Respondent under the terms of the Customer Agreement and the terms of the Durable Power of Attorney for Financial Management.”

The panelists denied the firm’s counterclaim and ordered it to pay $27,675 of the $29,850 in hearing session fees, according to the award.

Keath’s attorneys Samuel B. Edwards of Shepherd Smith Edwards & Kantas in Houston, Texas, and Jeffrey R. Sonn of Sonn Law Group in Aventura, Florida, also declined to comment.

Turley, a 28-year industry veteran who had been with the J.P. Morgan unit since 2009, could not immediately be reached for comment. He was not named as a respondent to Keath’s arbitration claim.
Turley has not registered with another Finra member firm since his termination over “[l]oss of confidence concerning adherence to firm policies and brokerage order handling requirements,” according to his BrokerCheck record.

Turley began his brokerage career in 1988 at Morgan Stanley, where he remained until 1991, and joined Credit Suisse First Boston the following year, according to his BrokerCheck. He left First Boston in 1995 for a 10-year stint at Lehman Brothers, and was not registered with a Finra member firm between his 2005 exit from Lehman and his 2009 move to J.P. Morgan, according to the database.

The only other disclosure prior to 2020 on Turley’s record was a 1999 claim for $49,000 over alleged misrepresentation of investment products that was denied.