Brokers

Finra Fines, Suspends Another LPL Broker for Falsified Signatures 

The Financial Industry Regulatory Authority fined and suspended a 46-year industry veteran in Braintree, Massachusetts over falsifying signatures, according to a letter of settlement finalized on Friday. 

The enforcement action marks at least the 12th case that the regulator has brought against former LPL brokers over falsified signatures since July when LPL itself paid a $3 million fine for failing to capture signature falsifications among other allegations.

In last week’s case, Timothy W. Leveroni agreed to a $7,500 fine and two-month suspension to settle allegations that from May 2020 to March 2021, he allowed other LPL brokers to sign his name on over 100 documents. The colleagues signed Leveroni’s name on client documents where he was the broker of record, including new account applications and update forms. 

While none of the customers complained, Leveroni violated Finra’s Rule 2010 requiring “high standards” and its books-and-records requirements under Rule 4511. 

Finra’s settlement noted that LPL had meted out its own internal discipline, a $1,000 fine and a letter of caution for Leveroni. Leveroni, who joined LPL in 2003 from Mutual Service Corporation, remains with the independent broker-dealer, according to BrokerCheck. 

Two Boston-based lawyers with Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, who represented Leveroni, did not respond immediately to a request for comment. Leveroni neither admitted or denied its finding, Finra said in the letter. No clients 

LPL spokespersons did not respond immediately to a request for comments.

In 2022, LPL terminated a swath of brokers over allegations related to their use of electronic signatures.

In July 2023, Finra ordered LPL to pay the $3 million fine as well as two clients a total of $100,000 in restitution tied to allegations that it failed to properly supervise fund transfer requests and monitor for forged signatures, according to a letter of settlement finalized on Tuesday.  

Between May 2018 and August 2020, LPL’s compliance system was not “reasonably designed” to detect or respond to red flags about improper movement of customer funds, including that multiple customers were transferring money from their brokerage accounts to the same outside entity or to a broker’s own address, Finra said at that time. 

In addition, Finra said that LPL, the nation’s largest independent brokerage based on its 21,000-broker roster, failed from January 2018 to January 2022 to detect instances of signature forgery or falsification. At least 50 LPL brokers were able to electronically sign a customer’s name on over 1,000 documents, including account transfer and money movement forms, Finra said. 

Since then, Finra records show it has taken actions against a dozen, including Leveroni, former or existing LPL brokers, including one who allegedly electronically signed the name of his partner, who “unexpectedly stopped” coming to work for six weeks, on client account forms. 

In September 2023, LPL agreed to pay a $250,000 fine to Massachusetts regulators for related violations, including supervisory failures, according to a consent order.

In early February, LPL refiled many of its advisory and wrap programs’ brochures filed with the Securities and Exchange Commission to reflect, among other material changes, the regulators’ disciplinary actions to which it had agreed.

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