X0304 TA-1/A LIVE 3.4.0 0001007444 084-05637 SEC LPL Financial LLC LPL Financial Corporation 008698 4828 Parkway Plaza Blvd. Charlotte NC NORTH CAROLINA 28217 false 800-877-7210 false false false false Other LLC LPL Holdings, Inc. 1989-04-01 Managing Member Parent Company Mark Robert Helliker 2008-08-01 Managing Director Client Support Services Robert Joseph Moore 2012-05-01 President and Director Advisor & Institution Solutions Sharyn J. Handelsman 2014-01-01 Executive Vice President Chief Compliance Officer, Brokerage George Burton White 2007-11-01 Managing Director Chief Investment Officer Dan Hogan Arnold, Jr. 2012-05-01 Managing Director Chief Financial Officer David Paul Bergers 2013-08-01 Managing Director and Director Legal and Government Relations Michelle Oroschakoff 2013-09-01 Managing Director Chief Risk Officer Paul Middlemiss 2011-05-01 Executive Vice President Chief Compliance Officer, Advisory John Andrew Kalbaugh 2010-03-01 Managing Director Financial Institution Services Joan Dominy Khoury 2012-05-01 Managing Director Chief Marketing Officer 2014-06-01 Sallie Rebecca Larsen 2012-05-01 Managing Director Chief Human Capital Officer Victor Peter Fetter, III 2012-12-01 Managing Director Chief Technology Officer Mark Stephen Casady 2005-12-01 Chairman of the Board and CEO Chief Executive Officer William P. Morrissey, Jr. 2014-04-01 Managing Director Independent Advisor Services Stephanie Leigh Brown 2004-03-01 Managing Director General Counsel 2013-08-19 Esther Marion Stearns 2007-03-01 Chief Operating Officer President 2012-05-01 William Edward Dwyer III 2004-01-01 Managing Director National Sales 2013-03-01 Denise Abood 2008-01-01 Managing Director Human Capital 2012-06-30 Jonathan Eaton 2008-01-01 Managing Director Retirement Planning 2012-06-30 Christopher F. Feeney 2008-01-28 Managing Director Chief Information Officer 2012-12-31 Kathy VanNoy-Pineda 2009-05-21 EVP Chief Compliance Officer, Brokerage 2014-01-01 John J. McDermott Jr. 2009-07-27 Managing Director Chief Risk Officer 2013-09-13 Abdiel Alan Valenzuela 2009-05-21 VP - Advisory Chief Compliance Officer, Advisory 2011-05-01 Derek Bruton 2010-03-01 Managing Director National Sales 2014-04-04 Becky Shulman 2011-06-06 Managing Director Deputy CFO 2011-11-21 Mary Frances Schott 2014-06-01 Managing Director Client Experience and Training Ryan Christopher Parker 2014-06-01 Managing Director Investment and Planning Solutions true LPL Financial Holdings Inc. Sole stockholder of LPL Holdings, Inc. false false false false false false true Linsco/Private Ledger Corp. (N/K/A LPL Financial) SEC Administrative Proceeding Rel. Nos. 33-8371 and 34-49232 2004-02-12 The Securities and Exchange Commission Action involved allegations related to application of mutual breakpoints for eligible customers on purchases of front-end load mutual funds. The SEC issued and order against LPL that resulted in a censure, monetary fine, disgorgement/restitution and cease and desist/injunction. LPL Financial SEC Administrative Proceeding No. 34-58515 2008-09-11 The Securities and Exchange Commission Proceeding involved allegations of violations of the safeguards rules of Regulation S-P. The SEC issued an order against LPL that resulted in a censure, monetary fine, remedial undertakings by LPL, and cease and desist/injunction. false true LPL Financial SEC Administrative Proceeding Rel. Nos. 33-8371 and 34-49232 2004-02-12 The Securities and Exchange Commission Action involved allegations related to application of mutual breakpoints for eligible customers on purchases of front-end load mutual funds. The SEC issued an order against LPL that resulted in a censure, monetary fine, disgorgement/restitution, and cease and desist/injunction. true LPL Financial Consent Order 2014-09-04 State of Ohio Department of Insurance LPL failed to report various regulatory actions to the Ohio Department of Insurance within 30 days. $800.00 fine and investigative costs of $200.00. true Private Ledger Financial Services, Inc. (N/K/A LPL Financial) Docket/Case Number: 82-66-S 1984-05-20 State of Michigan The matter involved a client that was sold various securities by two Private Ledger Financial Services, Inc. (PLFS) agents who were not registered in Michigan at the time of sale, which is a violation of Michigan Securities Act. PLFS was censured and ordered to pay restitution of $11,163.00 to a Michigan client. Private Ledger Financial Services, Inc. (N/K/A LPL Financial) Docket/Case Number: 50-86-952(a). 1986-05-14 State of Georgia The matter involved allegations that PLFS offered for sale and sold securities which were not effectively registered nor exempt from registration. PLFS reimbursed the Commissioner in the amount of $1,000.00 and agreed to cease and desist without admitting or denying any of the findings of fact or conclusions of Law. LPL Financial Docket/Case Number: 9501-04LC 1996-10-09 State of Pennsylvania The matter involved conduct of a former registered representative and one of its predecessor firms, Private Ledger Financial Services (PLFS). LPL consented to an order requiring it to engage an independent consultant to review its existing compliance policies & procedures, pay costs of $19,304.94 and comply with PA securities regulations. LPL Financial Docket/Case Number: 97E179 1998-12-01 State of Kansas The proceeding was based on the conduct of a former registered representative and one of its predecessor firms, PLFS. LPL agreed to review procedures and make modifications that LPL determines to be reasonable, not overly burdensome and offers restitution to certain LPL customers. LPL Financial Docket/Case Number: IC06-CAF-19 2006-06-28 State of Texas Involved allegations that LPL failed to timely update its Form BD to reflect the use of other business names in connection with securities activity by certain LPL branch offices in TX. The order resulted in a reprimand and administrative fine in the amount of $10,000.00. LPL Financial Docket/Case Number: 2007-03-01 2007-11-20 State of Pennsylvania Allegations that at certain times between 1998 and 2006, LPL failed to maintain or enforce procedures reasonably designed to supervise one or more of its former registered representatives. The matter resulted in a $200,000.00 administrative assessment and $30,000.00 for investigative and legal costs. LPL Financial Docket/Case Number: SEC-2009-46 2009-09-11 State of Montana Allegation that LPL failed to reasonably supervise a former registered representative. LPL consented to pay restitution of $1,144,416.51 and a fine to the State of Montana of $150,000.00. LPL Financial Docket/Case Number: SEU-2007-73 2007-12-24 State of Hawaii Allegation of failure to disclose to clients material information in connection with the offer, sale or purchase of securities. Consent agreement resulted in an administrative penalty of $10,000.00. LPL Financial Docket/Case Number: 2010-AH-012 2009-12-08 State of Kentucky Allegation that LPL paid advisory compensation to registered representative who was not qualified and was not registered as an investment advisor representative. Matter resulted in a fine of $4,000.00. LPL Financial Docket/Case Number: 0800381 2010-07-12 State of Illinois Allegation that LPL failed to detect the role of one of its former representatives in the sale of participations in oil and gas projects. Matter resulted in a $300,000.00 fine and restitution of $167,796.00. LPL Financial Docket/Case Number: AP-10-16 2010-08-11 State of Missouri Matter involved sale of variable annuity contract in which one of its representatives allegedly misunderstood the contract's rider. Matter resulted in a censure and $37,540.00 in total for fine, restitution and interest. LPL Financial Docket/Case Number:1000096 2011-10-24 State of Illinois Allegation that LPL failed to supervise a former registered representative. Matter resulted in restitution of $1,885,000.00 to customers. LPL Financial Docket/Case Number: 2009-10-06 2011-12-06 State of Pennsylvania Allegation that LPL failed to supervise two former registered representatives. Matter resulted in a fine of $59,092.52 and investigative costs. LPL Financial Docket/Case Number: S-07-0001-2 2011-11-08 State of Oregon Allegation that LPL failed to supervise a former OSJ manager's transactions. Matter resulted in a fine of $100,000.00. LPL Financial Docket/Case Number: AP-13-21 2013-12-17 State of Missouri Allegation that LPL failed to supervise a former registered representative. Fine of $175,000.00 and pay the cost of the investigation in the amount of $10,000.00. LPL Financial Docket/Case Number: SEC-2012-144 2012-11-04 State of Montana Allegation that LPL failed to supervise a former registered representative. Matter resulted in a fine of $10,000.00 and restitution of $20,500.00 to customers. LPL Financial Docket/Case Number: 2012-0036 2012-12-12 State of Massachusetts Allegations of failure to supervise and train registered representatives in connection with the sale of non-traded REITS. Matter resulted in a fine of $500,000.00 and restitution to certain customers. LPL Financial Docket/Case Number: IC08-CAF-22 2008-12-30 State of Texas The state alleged that LPL failed to enforce its written procedures by failing to report a felony charge on a registered representative's Form U4. Fine of $5,000.00. LPL Financial File No. 1200385 2014-06-30 State of Illinois Securities Department LPL submitted to a consent order with the Illinois Securities Department in connection with certain variable annuity exchange transactions, in particular, relating to its failure to adequately enforce supervisory procedures and maintain certain books and records required under Illinois law. LPL agreed to a censure, fine of $2,000,000.00 and restitution to impacted customers of approximately $800,000.00. LPL Financial File no. 1200385 2014-10-31 State of Illinois Securities Department LPL Financial failed to detect improper and fraudulent conduct on the part of David Lisnek toward his LPL clients. LPL Financial allowed Mr. Lisnek to remain a registered representative while several facts, viewed together as a pattern of conduct, would have constituted multiple cautionary indicators of the potential for improper conduct. Fine of $500,000.00 and restitution in the amount of $315,218.00. false true LPL Financial Docket/Case Number: IC06-CAF-19 2006-06-28 State of Texas Involved allegations with LPL failed to timely update its Form BD to reflect the use of other business names in connection with securities activity by certain LPL branch offices in TX. The order resulted in a reprimand and a fine in the amount of $10,000.00. LPL Financial Docket/Case Number: SEC-2009-46 2009-10-26 State of Montana Allegation that LPL failed to reasonably supervise a former registered representative. Consent order resulted in LPL agreeing to pay restitution of $1,144,416.51 and a fine to the State of MT of $150,000.00. LPL Financial Docket/Case No. 2010-AH-012 2009-12-08 State of Kentucky Allegation that LPL paid advisory compensation to a registered representative who was not qualified and was not registered as an investment advisor representative. $4,000.00 fine. LPL Financial Docket/Case Number: 0800381 2010-07-12 State of Illinois Allegation that LPL failed to detect role of one of its former representatives in the sale of participations in oil and gas projects. Matter resulted in a $300,000.00 fine and restitution of $167,796.00. LPL Financial Docket/Case Number: 1000096 2011-10-24 State of Illinois Allegation that LPL failed to supervise a former registered representative. Matter resulted in $1,885,000.00 restitution to customers. LPL Financial Docket/Case Number: 2009-10-06 2011-12-06 State of Pennsylvania Allegation that LPL failed to supervise two former registered representatives. Matter resulted in $59,092.52 fine for investigative costs. LPL Financial Docket/Case Number: S-07-0001-2 2011-11-08 State of Oregon Allegation that LPL failed to supervise a former OSJ manager's transactions. Matter resulted in $100,000.00 fine. LPL Financial Docket/Case Number: AP-10-16 2010-08-11 State of Missouri Matter involved sale of variable annuity contract in which a registered representative allegedly misunderstood the contract's rider. Matter resulted in a censure and $37,540.00 in total for fine, restitution and interest. LPL Financial Docket/Case No. 2007-03-01 2007-11-20 State of Pennsylvania Allegations that at certain times between 1998 and 2006, LPL failed to maintain or enforce procedures reasonably designed to supervise one or more of its former registered representatives. The matter resulted in a $200,000.00 administrative assessment and $30,000.00 for investigative and legal costs. LPL Financial Docket/Case Number: IC08-CAF-22 2008-12-30 State of Texas The state alleged that LPL failed to enforce its written procedures relating to the notification of a felony charge and Form U4 updates. Fine of $5,000.00. LPL Financial Docket/Case Number: AP-13-21 2013-12-17 State of Missouri Allegation that LPL failed to supervise a former registered representative. Fine of $175,000.00 and payment of the cost of the investigation in the amount of $10,000.00. LPL Financial Docket/Case Number: SEC-2012-144 2012-11-04 State of Montana Allegation that LPL failed to supervise a former registered representative. Fine of $10,000.00 and $20,500.00 in restitution to customers. LPL Financial Docket/Case Number: 2012-0036 2012-12-12 State of Massachusetts Allegations of failure to supervise and train registered representatives in connection with the sale of non-traded REITS. Fine of $500,000.00 and restitution to certain customers. LPL Financial File No. 1200385 2014-06-30 State of Illinois Securities Department LPL submitted to a consent order with the Illinois Securities Department in connection with certain variable annuity exchange transactions, in particular, relating to its failure to adequately enforce supervisory procedures and maintain certain books and records required under Illinois law. LPL agreed to a censure, fine of $2,000,000.00 and restitution to impacted customers of approximately $800,000.00 LPL Financial Consent Order 2014-09-04 State of Ohio Department of Insurance LPL failed to report various regulatory actions to the Ohio Department of Insurance within 30 days. $800.00 fine and investigative costs of $200.00. LPL Financial File No. 1200385 2014-10-31 State of Illinois Securities Department. LPL Financial failed to detect improper and fraudulent conduct on the part of David Lisnek toward his LPL clients. LPL Financial allowed Mr. Lisnek to remain a registered representative while several facts, viewed together as a pattern of conduct, would have constituted multiple cautionary indicators of the potential for improper conduct. Fine of $500,000.00 and restitution in the amount of $315,218.00. false false true LPL Financial Acceptance, Waiver and Consent 2013-05-21 FINRA The matter involved inadequate e-mail supervision and allegations of misstatements regarding the chronology of events concerning the LPL's discovery of the issue. Fine of $7,500,000.00. true PLFS (N/K/A LPL Financial) Acceptance, Waiver and Consent 1980-06-04 NASD District 2 Business Conduct Committee Allegations involved failure to supervise a branch office for use of stationary and business cards, failure to use appropriate signage and a listing in a phone directory. Fine of $500.00. LPL Financial Acceptance, Waiver and Consent 2003-02-13 NASD The matter arose out of a representatives' unauthorized participation in and postings on electronic bulletin boards. The AWC resulted in a fine of $5,000.00 and an undertaking to revise LPL's written supervisory procedures concerning communications with the public via electronic media. LPL Financial Acceptance, Waiver and Consent 2003-03-27 NASD The matter arose from an error in reporting 23 transactions in FIPS securities within five minutes after execution. The AWC resulted in a fine of $5,000.00. LPL Financial Acceptance, Waiver and Consent 2004-02-12 NASD Action involved allegations related to application of mutual breakpoints for eligible customers on purchases of front-end load mutual funds. LPL was censured and fined $2,232,805.00 and made various other undertakings to the NASD. LPL Financial Acceptance, Waiver and Consent 2004-10-11 NASD The matter involved allegations related to two municipal bond liquidations. AWC resulted in censure and fine of $5,000.00, restitution of $4,662.00, and undertaking to review written supervisory procedures related to determining FMV of municipal securities. LPL Financial Acceptance, Waiver and Consent 2004-11-30 NASD The matter arose out of LPL's alleged late filing of amendments to Forms U4 and Forms U5 from January 2002 through March 2004. The AWC resulted in a censure, fine in the amount of $450,000.00 and various undertakings by LPL. LPL Financial Acceptance, Waiver and Consent 2005-06-08 NASD The matter arose out of LPL's acceptance of directed brokerage payments from mutual fund companies. The AWC resulted in a fine of $3,602,398.00. LPL Financial Acceptance, Waiver and Consent 2005-11-14 NASD Allegations that LPL failed to establish, maintain and enforce reasonable system of procedures to supervise activities of registered persons in connection with wire transfers. AWC resulted in a censure and fine of $75,000.00. LPL Financial Acceptance, Waiver and Consent 2005-12-19 NASD Matter arose out of allegations related to recommendations to customers for the purchase of mutual fund Class B and C shares. The AWC resulted in a fine of $2,400,000.00. LPL Financial Acceptance, Waiver and Consent 2006-01-06 NASD The matter arose out of allegations related to violations of NASD rules regarding the termination of research coverage of subject companies. The matter resulted in a fine of $5,000.00. LPL Financial Acceptance, Waiver and Consent 2006-12-21 NASD Allegations were that during a period, LPL failed to establish, maintain and enforce adequate supervisory systems related to variable annuity exchanges. The AWC resulted in various undertakings by LPL. LPL Financial Acceptance, Waiver and Consent 2007-04-17 NASD Allegations that LPL failed to timely amend a representative's Form U4 with material information. The AWC resulted in a fine of $5,000.00. LPL Financial Acceptance, Waiver and Consent 2009-09-04 FINRA Allegations involved failure to comply with MSRB Rule G-14. AWC resulted in a fine to LPL of $5,000.00. LPL Financial Acceptance, Waiver and Consent 2011-01-20 FINRA Allegations involved review of e-mails. Resulted in a censure and fine of $100,000.00. LPL Financial Acceptance, Waiver and Consent 2011-01-20 FINRA Allegations involved review of procedures on transmittal of cash and securities from customer accounts to third-party accounts. Resulted in a censure and fine of $100,000.00. LPL Financial Acceptance, Waiver and Consent 2011-01-06 FINRA Allegations that LPL did not use reasonable diligence to ascertain best inter-dealer market and failed to buy or sell in such market so that the resulting price to customers was as favorable as possible. Resulted in a censure and fine of $20,000.00. LPL Financial Acceptance, Waiver and Consent 2010-12-22 FINRA Allegations involved procedures on supervision of variable annuity exchanges. Resulted in a censure and fine of $175,000.00. LPL Financial Acceptance, Waiver and Consent 2008-06-03 FINRA Allegations involved failure to supervise a former registered representative in connection with his/her use of investment strategies, marketing materials and the appropriateness of investments. Resulted in a censure and fine of $125,000.00 LPL Financial Acceptance, Waiver and Consent 2011-06-08 FINRA Allegations involved procedures on supervision of advertising and public appearances. AWC resulted in a fine of $25,000.00. LPL Financial Acceptance, Waiver and Consent 2012-06-26 FINRA Allegations of trade reporting violations. Matter resulted in censure and $17,000.00 fine. LPL Financial Acceptance, Waiver and Consent 2011-07-26 FINRA Allegations of trade reporting violations. Matter resulted in censure and $22,500.00 fine. LPL Financial Acceptance, Waiver and Consent 2013-05-21 FINRA The matter involved inadequate e-mail supervision and allegations of misstatements regarding the chronology of events concerning the LPL's discovery of the issue. Fine of $7,500,000.00. LPL Financial Acceptance, Waiver and Consent 2013-05-16 FINRA The action arose from allegations of charging commissions that were not fair and reasonable on certain corporate and municipal bonds. Fine of $60,000.00. LPL Financial Acceptance, Waiver and Consent 2012-12-31 FINRA Allegations of inadequate supervision of mutual fund prospectus delivery to customers. Fine of $400,000.00. false false false false true N/A N/A 1989-12-01 N/A A claim for recovery of corporate funds embezzled by a former employee (not securities licensed) in the Private Ledger Financial Services Accounting Department. Claim was paid in late 1989 by the National Union Fire Insurance Company. N/A N/A 2006-12-01 N/A Claim for misappropriation of funds by a former registered representative. Claim was paid during 2004 through 2006 by Zurich American. N/A N/A 2007-07-27 N/A Claim for misappropriation of funds by a former registered representative. Claim of $50,000.00 was paid on July 27, 2007 by Zurich American. N/A N/A 2011-11-02 N/A Indemnification payments received from fidelity bond carrier. Claims arising from payments made by individuals to a former registered representative. Payments totaling $1,279,433.79. Dates of payments: August 31, 2009 - $1,080,233.79; July 20, 2010 - $14,000.00 and; November 2, 2011 - $185,200.00. N/A N/A 2011-10-18 N/A Issue related to non-payment of funds loaned to a former registered representative. $2,000,000.00 claim paid. N/A N/A 2013-11-05 N/A Claim for misappropriation of funds by a former registered representative. $1,300,000.00 claim paid. false Steve Morrison Senior Vice President, Associate Counsel 617-423-3644 2014-12-29