The Securities and Exchange Commission (SEC) charged former LPL Financial LLC broker Blake Richards with misappropriating $2 million from at least six clients in relation to a fraudulent scheme.
2013 has been a challenging year for LPL. In February, the Massachusetts Security Division ordered LPL to pay over $2 million in restitution for misconduct related to non-traded REIT transactions while just this week, LPL was ordered to pay a record $9 million for failures related to e-mail communications.
According to the SEC, the misappropriated money was comprised of "retirement savings and/or life insurance proceeds from deceased spouses."
The complaint describes the specific alleged story in which Richards gained one investor's trust by delivering pain medication during a snowstorm to a client whose husband was ill with terminal pancreatic cancer.
Upon learning of the misconduct, LPL terminated Richards' employment and maintains that the former adviser did not take client funds from accounts at LPL, with the SEC's complaint alleging that Richards engaged in a "selling away" scheme in which Richards engaged in outside business away from the firm in order to defraud investors.
Richards allegedly effected the fraudulent scheme by instructing retirement account and life insurance clients to write checks to "Blake Richards Investments" or "BMO Investments," both entities Richards owned or controlled. The complaint alleges that upon receiving payment, Richards misappropriated the funds.
We have represented investors in almost identical fraudulent schemes, successfully bringing claims against the brokerage firms which were obligated to supervise the business activities of their registered representatives (brokers).
If you invested with Blake Richards, LPL or with any broker or financial professional who has engaged in outside business activities or "selling away" in violation of firm policies, industry rules or whose shady dealings have proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.
News: Ex-LPL adviser charged with stealing $2M from clients (InvestmentNews)