Run-ins didn’t drive hiring of new counsel: LPL boss

LPL Financial LLC has had several recent run-ins with regulators, but that isn’t the reason it hired a…

LPL Financial LLC has had several recent run-ins with regulators, but that isn’t the reason it hired a former Securities and Exchange Commission official as its top legal officer, according to the company’s chief executive.

David Bergers, 45, former acting deputy director of the SEC’s Division of Enforcement, will take over Aug. 5 as general counsel and managing director for legal and government relations at the firm’s holding company, LPL Financial Holdings Inc.

“We’re looking for the best talent we can find,” said LPL chairman and chief executive Mark Casady. “In this case, it was someone who was at the SEC recently.”

Still, he acknowledged that Mr. Bergers’ “deep knowledge and very recent experience at the SEC” was a factor in hiring him to oversee the firm’s legal staff.

Last month, the Financial Industry Regulatory Authority Inc. fined LPL $7.5 million for 35 significant e-mail violations — the largest e-mail-related penalty in Finra’s history. In addition, the firm in February was hit with a $500,000 fine by Massachusetts securities regulators — and had to pay $4.8 million in investor restitution — for failing to properly supervise brokers selling nontraded REITs.

Mr. Bergers, who spent 13 years at the SEC and was head of the commission’s Boston regional office from 2006 until this year, said that he doesn’t have a mandate to make specific changes in LPL’s compliance system.

But he was drawn to the company because of its commitment to supporting the personnel and technology necessary to strengthen the function.

Mr. Bergers replaces Stephanie Brown, LPL’s chief legal officer and a 24-year veteran of the firm.

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