The U.S. Securities and Exchange Commission brought charges against broker-dealer and investment adviser LPL Financial LLC for multiple failures in its anti-money laundering (AML) program, and settled the matter with an order requiring a USD 18 million civil penalty and improvements to AML policies and procedures. From at least May 2019 through December 2023, the SEC found longstanding weaknesses in LPL’s customer identification program, including failing to timely close accounts where the firm had not properly verified customers’ identities. The order also found LPL did not close or restrict thousands of high-risk accounts, including cannabis-related and foreign accounts, that were prohibited under its AML policies. The SEC found willful violations of Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-8, and imposed a censure and cease-and-desist order, with LPL neither admitting nor denying the findings. The order further directs LPL to continue engaging a compliance consultant to review and recommend changes to its AML policies and procedures.
U.S. Securities & Exchange Commission 2025-01-17
U.S. Securities and Exchange Commission charges LPL Financial with AML program failures and orders USD 18 million penalty and remediation
The U.S. Securities and Exchange Commission charged LPL Financial LLC with multiple anti-money laundering (AML) program failures, resulting in an USD 18 million civil penalty and mandated improvements. From May 2019 to December 2023, LPL failed to verify customer identities and manage high-risk accounts, violating Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-8. LPL must engage a compliance consultant to enhance its AML policies and procedures.