LPL Financial reached settlement with the North American State Securities Administrators Association (NASAA) to pay nearly $26 million in fines and penalties for selling unregistered securities not exempt from registration, dating back to at least 2006, and for other failures pertaining to supervision and compliance deficiencies.
California was the only state not to join in the LPL Financial settlement, meaning that claims arising out of California against LPL Financial and its representatives still must proceed through the standard dispute process, which may include arbitration and/or mediation.
NASAA found that LPL failed to establish and maintain reasonable supervisory policies and procedures designed to prevent LPL's sale of unregistered, non-exempt securities, such that the firm, from 2006 through the present, improperly offered unregistered, non-exempt equity and fixed-income securities to its customers. LPL also allegedly cancelled a compliance program that may have helped curb the firm's registration failures over the past decade.
Additionally, the settlement found that LPL acted negligently in failing to comply with various securities registration requirements, failed to supervise representatives so as to ensure compliance with applicable registration rules and regulations, and failed to maintain accurate books and records, which is a common requirement amongst regulators, including FINRA and the SEC. In response, LPL agreed to review its securities registration and compliance procedures.
Pursuant to the settlement's terms, LPL agreed to offer to repurchase the aforementioned violative securities; however, because California was the only state not to join in the settlement, Californian investors who transacted these unsuitable and/or unregistered LPL-offered securities will have to contact a local securities law professional in order to pursue a complaint or arbitration against LPL for the firm's wrongdoing in the state of California.
If you are one of LPL's California customers who invested in one of the firm's unregistered and/or unsuitable securities and these improper transactions 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.