By Andrew Welsch

The Securities and Exchange Commission has ended its investigation into LPL Financial's cash sweep program, the company disclosed in its annual 10-K report filed Tuesday.

The commission began looking into LPL's cash management program for corporate advisory accounts in August 2024, according to the filing.

Like other brokerage firms, LPL "sweeps" customers' uninvested cash into sweep accounts, which typically pay low rates of interest but often come with FDIC insurance. These accounts came under heightened scrutiny after short-term interest rates began soaring in 2022. As high-yield savings accounts and money-market funds were paying rates above 5%, some brokerage firms were paying as little as 0.05% on cash deposits.

Representatives for LPL and the SEC declined to comment.

In recent years, some customers have filed lawsuits against brokerage firms, alleging that companies' cash sweep practices are breaches of fiduciary duty to clients. One such group of customers filed a suit against LPL in federal court in July 2024. The case continues, and LPL "intends to defend vigorously against the lawsuits," according to its filing.

Although the SEC evidently wound down its inquiry into LPL's cash management practices, other companies have reached settlements with the commission. In June 2025, Bank of America's Merrill and two units of Wells Fargo agreed to pay $60 million in combined penalties to settle SEC charges that they failed to consider the best interest of clients when designing automatic cash sweep programs.

Write to Andrew Welsch at andrew.welsch@barrons.com

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February 25, 2026 16:57 ET (21:57 GMT)

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