LPL Financial to pay $1.1 million
According to reports today, the Massachusetts Securities Division has fined LPL Financial $1.1 million for allegedly failing to properly register agents in Massachusetts and timely file certain reportable events.
For the past six years, LPL reportedly violated securities laws by reportedly having 651 agents who were not registered in the state of Massachusetts. Further, the firm allegedly failed to file timely notice of nearly 800 reportable events, including customer complaints, criminal events, regulatory actions, bankruptcies, and judgments or liens.
LPL reportedly agreed to the fine as part of a consent order that also requires a review of the company’s policies and procedures.
This is not the first time that LPL has been in hot water with the state of Massachusetts. Last June, the broker dealer was involved in a $26 million nationwide settlement after regulators found that LPL had been negligent in its duty to supervise its agents and prevent the sale of unregistered securities to its customers over a 12-year period.
The securities division has censured the firm and it has been ordered to cease and desist in violations of state securities laws, in addition to the fine and the review of policies and procedures.
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Brokerage firms that fail to monitor the business activities of their employees may be liable for investment losses due to negligent supervision for the misconduct of their employees.
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