SEC charges La Jolla’s LPL Financial with anti-money laundering violations

LPL Financial, a La Jolla-based investment and wealth management services firm, will pay $18 million to settle charges by the Securities and Exchange Commission for violations of anti-money laundering policies.

The charges announced Friday by the SEC say that LPL Financial had multiple failures related to its customer identification program from at least May 2019 through December 2023. The firm did not make timely closures of accounts that did not properly verify a customer’s identity and it did not follow its policy of closing prohibited, high risk accounts, such as those of cannabis-related and foreign accounts, officials said.

Stacy Bogert, associate director of the SEC’s Division of Enforcement, said in the announcement that federal law requires broker-dealers like LPL to know their customer’s identity and conduct continual due diligence “to aid the government in its efforts to detect and prevent money laundering,”

“When broker-dealers like LPL fail to comply with (anti-money laundering) obligations, they put the securities markets at risk,” Bogert said in the statement. “Today’s case underscores the importance of complying with applicable regulations in the areas of customer identification and ongoing customer due diligence.”

The SEC order also directs LPL Financial to continue using a compliant consultant to review and recommend changes to its practices.

The company agreed to pay an $18 million civil penalty to begin improvements to its anti-money laundering policies and procedures. It also agreed to a censure and a cease-and-desist order without admitting or denying the SEC’s findings, the federal agency said.

LPL Financial did not respond to the Union-Tribune’s request for comment on Friday.

The local company touts itself as “the nation’s largest independent broker-dealer” and a leader in offering services to financial advisers. The firm primarily generates revenue from adviser fees and commission.

LPL Financial employed approximately 8,400 people in the U.S. as of Dec. 31, according to its annual report.

La Jolla-based LPL Financial fires its CEO for violating company’s code of conduct

©2025 The San Diego Union-Tribune. Visit sandiegouniontribune.com. Distributed by Tribune Content Agency, LLC.