LPL Dismissed From SECU Brokerage Case
In a case involving an alleged failed real estate transaction through a defunct credit union broker-dealer, LPL Financial Corp., the company that acquired the firm, said it was dismissed from the claim.
According to the October 2010 notice to the Financial Industry Regulatory Authority, SECU Brokerage Services Inc. and XCU Capital Corp. the CU-owned broker-dealer, dismissed their third-party claim against LPL Financial.
"We were first added to this legal action by the SECU, not the investor, and as an additional respondent only. We have since been dismissed from this case, which more than speaks for itself, and we are pleased to put it behind us," said Michael Herley, LPL Financial spokesperson.
The case involves an adviser who worked with XCU Capital, which was bought by LPL Financial in September 2007. SECU acquired XCU's corporate brokerage shell in January 2008 after all accounts had been transferred to LPL. The brokerage charter was moved to North Carolina and renamed SECU Brokerage Services in May 2008.
According to Cohen's trust, she allegedly lost $700,000 through a failed real estate investment, and the trustee filed a claim in 2009 to recover that amount plus $2.6 million in damages. An investment adviser with XCU Capital suggested Cohen buy a real estate investment with a company that owned a Florida apartment complex.
A series of FINRA arbitration hearings will take place on the matter Feb. 21-25, Feb. 28 and March 1-2.