SEC Bars LPL Financial advisor, Paul Lebel for Churning Client Mutual Fund Investments

mutual-funds

On October 18, 2016, the Securities Exchange Commission (SEC) barred LPL Financial advisor, Paul Lebel for churning and excessively trading mutual funds in customer accounts for the sole purpose of his own personal enrichment.   The excessive trading, also known as “churning” occurred during the period from 2008 to 2014, “during his employment with LPL, he defrauded four customers by churning several of their accounts,” according to the SEC administrative proceeding.

According to the SEC which imposed Remedial Sanctions and a Cease and Desist Order which was a Paul Lebel. “In particular, Lebel exercised de facto control over these customers’ accounts and excessively traded mutual fund shares which carry large front-end load fees (A shares). Lebel’s excessive trading was inconsistent with the customers’ investment objectives, and willfully disregarded the customer s’ interest.”

The SEC complaint alleged, “Lebel’s excessive trading was inconsistent with the customers’ investment objectives, and willfully disregarded the customers’ interest.” The SEC stated, “In light of Lebel’s customers investment objectives, were fraudulent, made to the detriment of Lebel’s customers, and without justification other than the generation of commissions for Lebel.”

Mr. Lebel excessively traded A Share mutual funds, designed to be long-term, buy-and-hold investments, which generated $50,000 in commissions.  As a part of the settlement with regulators, Paul Lebel will pay $56,500 as part of the settlement.

Klayman &Toskes, P.A. represents investors for brokerage firms violations of FINRA sales practice rules which may include; excessive trading, mutual fund switching, unsuitable recommendations, breach of fiduciary duty, misrepresentations and omissions of material facts and a failure to supervise.   Investors who have information about the sales practices of Wells Fargo Advisors and their financial advisors are encouraged to contact Lawrence L. Klayman, Esq. or Raymond Gentile, Esq. of Klayman & Toskes at (888) 997-9956, or visit our website at www.nasd-law.com.

About Klayman & Toskes, P.A.

K&T is a leading national securities law firm which practices exclusively in the field of securities arbitration and litigation, on behalf of retail and institutional investors throughout the world in large and complex securities matters. The firm represents high net-worth, ultra-high-net-worth, and institutional investors, such as non-profit organizations, unions, public and multi-employer pension funds. K&T has office locations in California, Florida, New York and Puerto Rico.

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