Finra bars former LPL rep over loan guarantees

Patrick Coogan signed bank ‘control agreements’ for a customer's loans without authorization

The Financial Industry Regulatory Authority Inc. has barred former LPL representative Patrick Coogan for signing bank control agreements without the firm’s authorization.

On behalf of one of his customers who pledged assets as loan collateral, Coogan signed seven control agreements from three banks, which gave the banks a security interest in the client’s LPL accounts. A control agreement is designed to protect a bank in the case of a borrower’s default, giving it access to the borrower’s assets before other creditors.

In a letter of acceptance, waiver and consent, Finra said that Coogan signed control agreements that contained misrepresentations about his client’s assets and that he had no authority to sign the control agreements. Further, it said that Coogan had not requested or obtained approval from LPL to sign any of the agreements, and that he didn’t inform the firm that he signed the agreements until after he had done so.

Coogan was affiliated with LPL from June 2009 until he was terminated in April 2018.

[More: Study shows softening of Finra enforcement last year]