LPL unit fined $1.5M over VA sales violations
Finra yesterday fined one of LPL Holding’s independent broker-dealers more than $1.5 million because of wide ranging violations in the sale and record-keeping of variable annuities transactions.
Finra yesterday fined one of LPL Holding’s independent broker-dealers more than $1.5 million because of wide ranging violations in the sale and record-keeping of variable annuities transactions.
The broker-dealer, Mutual Service Corp. of West Palm Beach, Fla., failed to conduct a timely review of variable annuity transactions, falsified books and records of the firm, and gave false and misleading information to the Financial Industry Regulatory Authority Inc. during its investigation, according to the Washington- and New York- based agency.
“We are pleased that this hearing — which involved the time period from 2002 through early 2005 — has been concluded, and that Finra did not at any time allege that any MSC customers were harmed,” MSC spokesman Joseph Kuo said in a statement.
Mutual Service Corp. has reviewed its compliance policies and procedures and made changes designed to avoid future occurrences, Mr. Kuo said. “Equally important, all of the individuals involved in this matter are no longer employees of Mutual Service Corp.”
The matter, however, is far from over. While Finra barred three Mutual Service employees from the industry, sanctions against three other employees have been delayed pending a ruling by Finra’s National Adjudicatory Council.
LPL Financial acquired Mutual Service Corp. in 2007. LPL Holding, which is based in Boston, has more than 11,000 affiliated representatives and advisers across its various platforms.
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