It was not a good week for LPL Financial LLC.
In addition to a $7.5 million fine for e-mail violations, the largest independent broker-dealer was involved in two other disciplinary actions.
Massachusetts securities regulators last week increased the amount of restitution it had ordered LPL to pay in connection with the improper sales of nontraded real estate investment trusts to $4.8 million, more than double the original amount.
It was not a good week for LPL Financial LLC.
In addition to a $7.5 million fine for e-mail violations, the largest independent broker-dealer was involved in two other disciplinary actions.
Massachusetts securities regulators last week increased the amount of restitution it had ordered LPL to pay in connection with the improper sales of nontraded real estate investment trusts to $4.8 million, more than double the original amount.
UPDATED NUMBERS
In February, LPL agreed to a $500,000 fine and to pay $2.2 million in restitution for failing to properly supervise brokers selling nontraded REITs. The amount was increased because the original amount was based on REIT sales only from 2005 through 2009. The adjusted number covers REIT sales through February.
In a separate case, an adviser formerly affiliated with LPL was charged by the Securities and Exchange Commission with defrauding investors and misappropriating $2 million from at least six clients.
The former LPL adviser, Blake Richards, misappropriated client money that "constituted retirement savings and/or life insurance proceeds from deceased spouses," according to the civil complaint, which was filed in U.S. District Court for the Northern District of Georgia.
A call to Mr. Richards' firm, Lanier Wealth Management in Buford, Ga., was not returned.
Mr. Richards was an LPL broker from May 2009 until this month, according to his profile on Finra's BrokerCheck website.
'SIPHONING OFF FUNDS'
"Richards ... began siphoning off funds from clients and converting them for his personal use," the complaint stated.
LPL spokeswoman Betsy Weinberger said Mr. Richards did not take client funds from LPL accounts. However, broker-dealers may be held accountable when investors want their money back in such cases.
27 May, 2013
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Source: http://www.investmentnews.com/article/20130526/REG/305269981
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