Former LPL Financial Representative Sentenced to Prison

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A former LPL Financial representative, Paul McGonigle, has been sentenced to 4½ years in prison for defrauding clients out of over $1.2 million. McGonigle, 67 years old and hailing from Middleboro, Mass., pleaded guilty in February to several charges including investment adviser fraud, money laundering, wire fraud, mail fraud, and aggravated identity theft.

According to prosecutors, McGonigle, during his affiliation with SII Investments starting in 2015, misappropriated funds from his clients’ annuities and deceived them into investing more money. He utilized these funds for personal and business expenses.

McGonigle’s attorney has not provided any comments on the matter.

LPL had acquired SII Investments in 2017 when it purchased the independent broker-dealer network of National Planning Holdings. A spokesperson for LPL has not responded to requests for comment.

Prosecutors have highlighted the vulnerability of McGonigle’s victims, many of whom were older individuals with diminished mental capacity.

It is important to note that financial crimes can have serious consequences and impact individuals who place their trust in financial professionals.


Introduction

In a startling case that has left many reeling, a former broker has been charged for exploiting vulnerable elderly individuals, including those living with dementia and cognitive impairments. Acting U.S. Attorney Joshua Levy expressed his outrage, stating, “This defendant took advantage of the elderly, including individuals living with dementia and other cognitive impairments, to line his own pockets. The conduct is despicable.”


Background

John McGonigle, who entered the brokerage sector in 1983, faced an investigation by Finra, the industry self-regulatory organization. Despite having a long career in the sector with only one brief gap in the late 1980s, his registration with LPL (a firm he was affiliated with) ended abruptly in June 2019. Unfortunately for McGonigle, he was unable to find an affiliation elsewhere.


Investigation and Suspension

Finra turned up the heat on McGonigle when they issued him a notice of suspension in August 2020. In response, McGonigle sought a hearing to appeal the suspension. However, he failed to provide any basis for his request upon Finra’s demand. As a result, in October, Finra dismissed his hearing request.

Persevering against the odds, McGonigle asked for his case to be reopened. Once again, Finra requested written materials from him to substantiate his appeal. Unfortunately, history repeated itself, as McGonigle failed to respond yet again. Faced with his lack of cooperation and consistent disregard for the process, Finra made the judgment call to bar him from the industry altogether.


Consequences and Restitution

Justice was served as McGonigle was sentenced to 54 months in prison for his crimes against the elderly. Additionally, he was ordered to pay restitution totaling $652,987.


Conclusion

The unfortunate case of John McGonigle serves as a sobering reminder of the need for vigilance in protecting the elderly. While the consequences finally caught up with him, we must remain steadfast in our commitment to prevent such exploitation from occurring in the first place.

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