Post by 12five on Feb 3, 2022 23:37:09 GMT
If you had a 401k and other investments with a financial advisor and received this in the mail, would you pull your money from the FA?
I have removed the name of the financial group. This is the summary statement. The details are about 20 pages long.
The SEC's order finds that xxxx., failed to provide full and fair disclosure of its conflicts of interest associated with client investments in (1) mutual fund share classes that paid xxxx affiliated broker fees pursuant to Rule 12b-1 under the Investment Company Act of 1940 (12b-1 fees); (2) certain mutual funds that generated no-transaction fee revenue for xxxx affiliated broker; and (3) cash sweep products that likewise resulted in xxxx affiliated broker receiving revenue sharing. While under prior ownership, xxxx did not self-report its receipt of 12b-1 fees to the Commission pursuant to the Division of Enforcement's Share Class Selection Disclosure Initiative although eligible to do so. According to the order, xxxx also breached its duty to seek best execution with respect to certain mutual fund investments and did not fulfill its duty of care obligations when it advised clients to invest in mutual funds and money market funds without undertaking an analysis to determine whether the share classes were in their best interests. The order finds that xxxx failed to adopt and implement written compliance policies and procedures reasonably designed to prevent these violations.
The SEC's order finds that xxxx violated Sections 206(2) and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-7 thereunder. Without admitting or denying the findings, xxxx consented to a cease-and-desist order and a censure, and agreed to pay disgorgement of $12,349,153, prejudgment interest of $2,524,000, and a civil penalty of $2,000,000. Xxxx has also agreed to distribute funds to harmed clients and comply with certain undertakings.
I have removed the name of the financial group. This is the summary statement. The details are about 20 pages long.
The SEC's order finds that xxxx., failed to provide full and fair disclosure of its conflicts of interest associated with client investments in (1) mutual fund share classes that paid xxxx affiliated broker fees pursuant to Rule 12b-1 under the Investment Company Act of 1940 (12b-1 fees); (2) certain mutual funds that generated no-transaction fee revenue for xxxx affiliated broker; and (3) cash sweep products that likewise resulted in xxxx affiliated broker receiving revenue sharing. While under prior ownership, xxxx did not self-report its receipt of 12b-1 fees to the Commission pursuant to the Division of Enforcement's Share Class Selection Disclosure Initiative although eligible to do so. According to the order, xxxx also breached its duty to seek best execution with respect to certain mutual fund investments and did not fulfill its duty of care obligations when it advised clients to invest in mutual funds and money market funds without undertaking an analysis to determine whether the share classes were in their best interests. The order finds that xxxx failed to adopt and implement written compliance policies and procedures reasonably designed to prevent these violations.
The SEC's order finds that xxxx violated Sections 206(2) and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-7 thereunder. Without admitting or denying the findings, xxxx consented to a cease-and-desist order and a censure, and agreed to pay disgorgement of $12,349,153, prejudgment interest of $2,524,000, and a civil penalty of $2,000,000. Xxxx has also agreed to distribute funds to harmed clients and comply with certain undertakings.
