Founded in 1989 when brokerage firms Private Ledger and Linsco merged, LPL Financial (“LPL”) is a registered investment adviser and the largest independent broker-dealer in the United States. The firm offers financial services such as annuities, bonds, mutual funds, equities, insurance, and fee-based programs. The firm, which is headquartered in San Diego, California, has $1T+ in brokerage and advisory client assets, serviced or custodied. In 2020, the firm generated approximately $5.9B in annual revenue.
In 2007, Mutual Service Corp., a brokerage firm based in West Palm Beach, Florida, became a part of the LPL Financial family of companies. Over the years LPL has acquired multiple firms including AdvisoryWorld (2018), E.K. Riley Investments, LLC (2020), Lucia Securities (2020), and Blaze Portfolio (2020)
In November 2022, it was announced that LPL was to acquire one of its own branch offices for the first time. The office in question, Financial Resources Group Investment Services, is located in Fort Mill, South Carolina and manages about $40B in advisory and brokerage assets.
LPL has serviced 21,000+ financial professionals and has partnered with 1,100+ financial institutions. Its brokers are licensed in all 50 states as well as the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.
Financial Misconduct at LPL Financial
LPL is licensed by the Financial Industry Regulatory Authority (FINRA), and as such is legally obligated to ensure its brokers are acting lawfully in the interest of their investors. If a client suffers losses as a result of negligent behavior or misconduct from a broker, then the firm may be held legally responsible to repay the damages.
LPL and brokers backed by LPL have a long history of misconduct and complaints. According to FINRA’s BrokerCheck report, LPL has 245 disclosures (184 regulatory events; 57 arbitrations; and 4 bonds) and has shelled out millions of dollars.
In August 2022, FINRA initiated a claim against LPL finding that between at least Dec. 2018 and April 2020 the firm failed to accurately calculate its customer reserve requirement and failed to maintain a sufficient customer reserve. Therefore, the firm caused two hindsight deficiencies totaling approximately $162M. LPL was censured and fined $300,000.
In December 2022, FINRA initiated a claim against LPL finding that the firm failed to investigate red flags related to a registered representative’s undisclosed outside business activities. The firm failed to reasonably supervise transfers of funds by the representative’s firm customers to third parties. As a result of outside dealings, the broker cost LPL customers more than $650k. LPL was fined $150,000.
Other reasons for the many fines levied against LPL over the years include:
Wondering If You Have a Claim? Contact Our Firm Now!
Meyer Wilson reclaimed $350 million for the victims of investment fraud or misconduct. Our attorneys are experienced in going up against the largest investment firms, such as LPL Financial, and our track record affirms our resources and expertise. Meyer Wilson has represented clients nationwide and internationally, in state and federal courts, and in securities arbitration. As an investor, you have a right to recover investments lost through unethical behavior or decisions made against your interests.
