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LPL agrees to settlement with FINRA over historical compliance matters

October 30, 2018

LPL Financial

Today, LPL agreed to a settlement with the Financial Industry Regulatory Authority (FINRA) on historical compliance matters primarily related to anti-money-laundering (AML) reporting and customer complaint reporting. As part of the settlement, the firm will pay a fine in the amount of $2.75 million and perform a look-back review of certain complaints.

Today, LPL agreed to a settlement with the Financial Industry Regulatory Authority (FINRA) on historical compliance matters primarily related to anti-money-laundering (AML) reporting and customer complaint reporting. As part of the settlement, the firm will pay a fine in the amount of $2.75 million and perform a look-back review of certain complaints. The time period covers 2013-2017.

The AML fine is specific to the filing of Suspicious Activity Reports (SAR) for incidents involving the company’s analysis of publicly available risk information and attempted email compromises. There was no customer loss related to these incidents.

“We’ve made significant investments to enhance our AML program at LPL. We’re pleased that FINRA noted our ‘extraordinary cooperation’ in identifying, self-reporting, investigating and remediating these issues thoroughly and promptly,” said Michelle Oroschakoff, managing director and chief Legal officer, LPL Financial.

As part of FINRA’s settlement, the regulatory agency recognized LPL’s “extraordinary cooperation” in having initiated an investigation on its own of its SAR filings and prompt remediation of the matter, among other things.

AML reporting has been a broad industry challenge, and there have been a wide variety of settlements between FINRA, the SEC, and other financial services firms related to AML compliance over the last several years. For example, in the past two years, firms have paid fines ranging from $1.3 million to $17 million for AML failures.