SEC Charges LPL Financial with Anti-Money Laundering Failures

Posted on February 7th, 2025 at 9:21 AM
SEC Charges LPL Financial with Anti-Money Laundering Failures

From the desk of Jim Eccleston at Eccleston Law

The Securities and Exchange Commission (SEC) has charged LPL Financial LLC, a broker-dealer and investment adviser, with multiple violations of anti-money laundering (AML) regulations. According to SEC.gov, LPL has agreed to pay a $18 million civil penalty and improve its AML policies and procedures to settle the charges.

The SEC’s order states that between May 2019 and December 2023, LPL failed to comply with its customer identification program and neglected to verify the identities of certain customers. SEC.gov also reports that LPL failed to close or restrict thousands of high-risk accounts, including cannabis-related and foreign accounts, despite their prohibition under the firm’s AML policies.

“Federal law requires broker-dealers to ascertain the identity of their customers and to conduct ongoing customer due diligence to aid the government in its efforts to detect and prevent money laundering,” said Stacy Bogert, Associate Director of the SEC’s Division of Enforcement. “When broker-dealers like LPL fail to comply with their AML obligations, they put the securities markets at risk.”

The SEC found that LPL willfully violated Section 17(a) of the Securities Exchange Act of 1934 and Rule 17a-8 under the Act. Without admitting or denying the SEC’s findings, LPL agreed to a cease-and-desist order, censure, and the $18 million penalty. Additionally, the firm will continue working with a compliance consultant to review and enhance its AML policies and procedures.

 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

Tags: eccleston, eccleston law, sec

Return to Archive

TESTIMONIALS

Previous
Next

This was the best of all possible outcomes and I cannot thank you and the team enough.

Michael S.

LATEST NEWS AND ARTICLES

September 17, 2025
FINRA Suspends Centaurus Dallas Broker Over Excessive Alternative Investment Sales

FINRA has suspended a Centaurus Financial broker, William Burks, for four months after finding he placed as much as 91 percent of a client’s net worth into illiquid alternative investments.

September 16, 2025
Former Morgan Stanley Advisors Win Partial Court Victory in Client Solicitation Dispute

Two former Morgan Stanley advisors in Hackensack, New Jersey have defeated Morgan Stanley’s initial effort to block them from soliciting clients, according to an August 15 order from New Jersey Superior Court.

September 15, 2025
California Young-Gun Investor Charged in Alleged $6 Million Ponzi Scheme

Federal prosecutors have accused Mihir Deepak Sukthankar, a California resident once celebrated as a teenage trading “prodigy,” of orchestrating a multi-million-dollar Ponzi scheme.