LPL Facing $3.6 Million Judgement | Cold Spring Advisory Group

LPL Facing $3.6 Million Judgement

April 7, 2015

LPL Financial (LPL) is being accused by the New Hampshire Bureau of Securities Regulation of failing to supervise brokers involved in selling real estate investment trusts (REITs) to elderly New Hampshire clients. New Hampshire regulators filed an action on Monday, April 6, 2015 seeking a $3.6 million judgement against LPL -- $2.4 million in restitution, a $1 million fine and $200,000 in investigative costs -- and revocation of LPL's license to sell securities in the state.

In early 2008, the bureau began investigating LPL after an elderly investor complained that she suffered significant losses after she invested $253,000 in a REIT she bought from LPL. The investigation revealed that LPL made 48 sales of high-risk, non-traded real estate trusts to elderly New Hampshire clients in violation of securities industry suitability rules.

LPL, one of the nation's largest independent brokerage firms, was unable to reach a settlement with the state and has 30 days to request a hearing with a bureau hearing officer.