Investment firm LPL Financial has agreed to pay a civil penalty of $450,000 for "various deficiencies" related to supervision of its Indiana operations, the Secretary of State’s office said Monday.
The Secretary of State’s office said an investigation found that LPL supervisors did properly review a number of emails involving Indiana operations for several years because of software glitch. LPL fixed the glitch after being notified of the problem during the investigation.
The investigation also found that LPL did not conduct annual compliance exams of its Indiana branches as required by law.
In addition to the civil penalty, LPL agreed to a conduct a third-party compliance review of its policies and procedures in Indiana and provide a report on the findings to the securities commissioner in 180 days for review.
“Broker-dealers and financial firms are often the first line of defense against fraud.” said Secretary of State Connie Lawson. “If a firm does not have, or does not follow its own supervisory procedures, Hoosiers could be at risk.”
Boston-based LPL offers securities through numerous independent broker dealers across the country, including several in Indianapolis.
This isn’t the first time LPL has had problems with regulators over local operations. In late 2015, the Financial Industry Regulatory Authority said broker Barbara D. Fife had been barred for life for declining to provide documents it was seeking for an investigation. Fife was registered at a Fishers office for LPL from September 2007 until June 2014, the month the company terminated her.
LPL paid a $257,000 settlement to a customer who complained about writing checks to Fife that were never invested in his or her account.