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LPL Settles with Galvin Over $26M Unregistered Securities Fine

By Alex Padalka June 14, 2018

LPL Financial has agreed to return money, with interest, to Massachusetts investors following a $26 million nationwide fine the company had agreed to previously in connection to the sales of unregistered securities, ThinkAdvisor writes.

The deal reached with Massachusetts regulators will see the state’s investors get the money they had invested in unregistered securities returned with 3% interest, according to a statement from Secretary of State William Galvin, the state’s top securities watchdog, cited by ThinkAdvisor.

Last month, LPL reached a deal with state regulators and the North American Securities Administrators Association to pay a fine of $499,000 to each of the 52 states and territories as well as reimburse customers for the sale of “unregistered, nonexempt [equity and fixed income] securities” sold as far back as 2006, the publication writes, citing NASAA.

Other states — each of which entered into separate administrative orders on the case — are likely to reach similar deals with LPL in the coming months, according to ThinkAdvisor.

When NASAA announced the settlement in May, LPL said it would “continue to dedicate resources” to its compliance and risk management, the publication writes.

“We believe these resources, combined with additional expertise we’ve hired in the field of blue sky compliance, position us well with respect to this issue in the future,” LPL said, according to ThinkAdvisor. “Our focus now is on offering remediation to investors who may have been affected.”