BOSTON-BASED LPL FINANCIAL WILL ALSO PAY RESCISSION TO MONTANANS
HELENA, Mont. – Securities Commissioner Matt Rosendale has secured a $499,000 settlement with a Boston-based financial company for failing to follow Montana securities laws.
LPL Financial will also repurchase securities that were sold in violation of the law later this year. Those rescission offers to affected Montanans will include a 3 percent annual interest rate on top of repayment of the original amount sold.
Problematic sales occurred between October 1, 2006, and May 1, 2018.
LPL’s settlement includes a $300,000 fine and a $199,000 contribution to the Securities Restitution Assistance Fund, a program overseen by the State Auditor’s office that gives assistance to Montana victims of securities fraud when they don’t receive restitution from perpetrators.
“I’m glad we were able to resolve this matter and Montanans will get their money back, with interest,” Rosendale said. “Anyone who is selling investments in Montana needs to comply with our laws by either registering those securities or using an authorized exemption from registration. All investments have risk, but investors need to be able to make fully-informed decisions before taking that risk.”
The settlement comes after a multi-state investigation by the North American Securities Administrators Association (NASAA) revealed that LPL Financial had violated “Blue Sky” laws. Blue Sky laws are state regulations that provide safeguards to protect investors from securities fraud. Montana is a member of NASAA through Rosendale’s office.
Allegations in the settlement include:
- LPL failed to establish and maintain procedures to prevent the sale of unregistered, non-exempt securities to its customers
- LPL offered and sold unregistered, non-exempt securities in Montana
- LPL failed to adequately comply with Blue Sky laws
- LPL failed to maintain books and records necessary for full compliance with Blue Sky laws
- LPL acted negligently in its failure to comply with Blue Sky laws