LPL Financial Is In The Process Of Terminating A “Swath Of Brokers” In Connection With The Purported Improper Use Of DocuSign By The Brokers On Behalf Of Their Clients.
A published report indicates that LPL Financial is in the process of terminating a “swath of brokers” in connection with the purported improper use of DocuSign by the brokers on behalf of their clients. It appears some brokers were under the mistaken impression that they could electronically sign the documents for their clients. DocuSign is a new tool being used by many firms to expedite account openings from a remote setting but many brokers may have been under the mistaken belief that with a client’s approval they could “sign” the document for the client. Signing on behalf of a client, even if authorized by the client, may not comply with firm requirements of an “original” or “genuine” signature of the client. According to the article, brokers are being terminated and their U5 will reflect that they “failed to ensure that account documents submitted to the firm contained genuine customer signatures.“ If you were recently terminated by LPL or any other firm for that matter, you have a short 30 day window from your termination date to raise questions about the U5 and the disclosure that will appear on your U5. The language on your U5 and how it reads could have a significant impact on your future job prospects and may hinder your ability to reregister with another firm and/or state and could trigger inquires from FINRA and state securities regulators. Hiring an experienced U5 attorney is imperative and may impact what is said on your U5. Experienced counsel can also assist in the pre-hire process with potential new employers and firms; can interface with state regulators, FINRA and other SROs during the reregistration process and can protect an advisor’s interests if a regulatory inquiry is made by FINRA (FINRA Rule 8210 request) or other regulatory agency.