By Matthias Rieker
A federal judge in Georgia ordered a former LPL Financial
Holdings Inc. (LPLA) financial adviser to return the almost $2
million he stole from his clients and pay a $80,000 penalty.
The Securities and Exchange Commission accused Blake Richards of
Buford, Ga., of stealing the retirement savings and life-insurance
proceeds of at least seven clients between 2009 and last year. The
agency says at least two of the clients were elderly.
He told the clients to write him checks and that he would invest
their money in life-insurance policies and annuities as well as
stocks and bonds, but used the money for his personal use and
provided fake account statements, according to the SEC.
In one case, he told a client he would invest his money in
Facebook Inc.'s (FB) initial public offering but spent the money on
himself, the agency says.
Mr. Richards admitted wrongdoing and cooperated with SEC the
investigation. However, he pleaded with the court for a lower
penalty, according to the court's ruling.
U.S. District Court Judge Willis Hunt Jr. of the Northern
District of Georgia ruled Tuesday that Mr. Richard's violations
were significant yet noted that his ability to pay was limited, the
ruling says. Mr. Richards has 30 days to pay the penalty and the
disgorgement.
For years, Mr. Richards production at LPL Financial "has been
virtually nonexistent," the SEC said in its complaint. He had
joined LPL in 2009 from Ameriprise Financial Inc. (AMP), where he
was also accused of misappropriating customer money, according to
his BrokerCheck record.
Mr. Richards was fired by LPL and barred from the industry by
the Financial Industry Regulatory Authority last year, his
BrokerCheck record shows.
A spokeswoman for LPL said the firm found out about Mr.
Richards's misappropriations and launched an internal
investigation. It also notified regulators and law enforcement
authorities, she said. None of the funds obtained by Mr. Richards
were from LPL accounts, she said.
Mr. Richards's lawyer didn't immediately return a phone call for
comment.
Write to Matthias Rieker at matthias.rieker@wsj.com
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