The SEC said it has barred former LPL Financial advisor Paul T. Lebel from the industry for "fraudulent" churning in mutual funds shares that generated him $50,037 in commissions in four of his clients' accounts. In particular, the SEC found that Lebel excessively traded shares that carried large front-end loads.

"Lebel’s excessive trading was inconsistent with the customers’ investment objectives, and willfully disregarded the customers’ interest," the SEC said in a statement. "Mutual fund A shares are designed for long-term, buy-and-hold investing and are unsuited for any known strategy involving frequent trading."

Bloomberg News

The SEC said Lebel should pay the $50,037 in disgorgement, plus prejudgment interest of $6,489, according to the order. However, the commission waived all but $10,000 to be paid in quarterly installments over the three years, due to Lebel's stated inability to pay, according to the order.

Lebel agreed to settle with the SEC without admitting guilt. He could not be reached for comment, and LPL declined to comment through a spokesman.

The FINRA BrokerCheck report for Cambridge, Massachusetts-based Lebel shows more than $100,000 in outstanding state and federal tax liens.

Lebel worked for LPL in Cambridge from 2008 to 2014, and then spent two months registered at Arthur W. Wood, a brokerage in Boston, between December 2014, and January 2015.

Register or login for access to this item and much more

All Financial Planning content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access

Ann Marsh

Ann Marsh

Ann Marsh is a senior editor and the West Coast Bureau Chief of Financial Planning. Follow her on Twitter at @Ann_Marsh.