6 years Ago, MarcWites
LPL Financial (“LPL”), virtually unknown ten years ago, currently ranks as the fourth-largest brokerage firm based on the number of business advisors, behind Wells Fargo, Morgan Stanley and Merrill Lynch. It markets itself as a low-cost investment house that allows smaller investors access to the same types of investments as investors with larger portfolios. During these precarious financial times, when other brokerage houses have tightened their belts and suffered losses, since 2005 LPL has exploded in size and now boasts 13,300 brokers in 6,500 offices that service 4.3 million customers. LPL has done so, in part, by touting the fact that it does not sell its own investment vehicles or engage in “proprietary trading” of its own account.
However, numerous accusations of malfeasance have been brought against the firm by state financial regulatory authorities, and individuals who have filed lawsuits against the company for losses they have incurred.
One of the key administrative functions that LPL is supposed to provide is supervision of the brokers’ compliance with financial rules and regulations enacted to protect individual investors from everything from improper investment advice to outright theft. At the same time, one of the accusations against LPL has been lapses in such oversight, from both state regulators and individual investors.
Claims against LPL brokers have included sales of improper investments to “non-qualified” individuals who cannot afford to place money in high risk investments, Ponzi schemes, and the “pushing” of investments which are contrary to the individual’s needs but pay large commissions to the selling broker.
As an example, some LPL brokers have allegedly encouraged smaller investors into junk-rated debt funds known as “non-traded business-development companies.” These funds claim that they offer opportunities to investors who are too small to invest in hedge funds and other private equity funds. While these debt funds offer large potential returns, they are sometimes called “junk” because they stand a significant risk on non-payment. In addition, buyers often pay large upfront fees and high management and performance fees which significantly cut into any financial returns. Finally, because of their high risk and the fact that they are not traded on any markets, investments in these funds are usually difficult to resell; as a result, investors are left holding onto mostly worthless, illiquid funds for which there is no resale market.
Not all LPL brokers have engaged in wrongdoing. However, LPL has numerous reportable events on its FINRA Broker Report. It has been named in regulatory actions concerning possible securities fraud violations, and has been the subject of investigations conducted by FINRA, the State of Missouri, the Kentucky Division of Securities, and the Securities and Exchange Commission. You can read about all such claims by visiting FINRA’s BrokerCheck at http://brokercheck.finra.org
We have written in the past about investments of which most investors should be leery. If you have suffered financial losses with an LPL broker, or any other investment advisor, you may wish to consult with qualified legal counsel who can review your investment history and documentation to determine whether you may be entitled to financial compensation.
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Marc: Congratulations on the School Board settlement! Glad you were about to get a good result for your clients. Having been your adversary early on in the case, I can say it was a long battle and the great result was due to your persistence and creative approach to the litigation. Well done!Josh Eggnatz
Attorneys often convey a sterile attitude toward clients that is often void of sincerity and compassion, and may even be condescending. Marc Wites has not lost his humanity!! Mr. Wites is an attorney that continues to stay abreast of the law, which results in excellent results for his clients. Marc Wites is my “go to” attorney when I am looking for A-rated service and quality representation. I consider Marc as not only my attorney but a friend as well.David
An impressive chamber of knowledgeable attorneys/staff that stand ready to work tirelessly on behalf of their clients. Marc Wites is the quintessential Perry Mason advocate–erudite, prepared, and brilliant. He is ready to take on any legal challenge. Above all, he is understanding of the working class. Surely, he’s not just in it for the money; he genuinely wants to help people. Overall outstanding law firm.Raymond Brown
Mr. Wites accepted my case when other lawyers would not. He never promised what he couldn’t deliver. He was realistic, upfront and honest. He actually returns phone calls. And he is willing to explain the legal process and to take time to answer questions. I would definitely contact Mr. Wites if I ever needed a lawyer again.Karla