The United States Securities and Exchange Commission (SEC) announced on
September 8th that they settled $850,000 worth of charges with the investment advisory
firms Raymond James & Associates based out of St. Petersburg, FL and
Robert W. Baird & Co. based out of Milwaukee, WI.
During the SEC’s investigation, they discovered that both firms failed
to establish the policies and procedures necessary to how much their sub-advisers
were charging clients in commissions when they “traded away”
with broker dealers outside of their wrap fee programs. This lack of information
meant that financial advisers at the firms could not give their clients
accurate information on how much they would be charged on commissions
when determining how suitable the wrap fee programs or sub-advisers were.
Without admitting or denying the charges, Baird has agreed to pay $250,000
in penalties to settle the charges brought by the SEC, and Raymond James
will pay $600,000 to settle their charges.
The SEC’s Director of the Division of Enforcement Andrew J. Ceresney
commented on the charges, saying that:
“Costs are a critical factor when firms determine whether a particular
investment product or strategy is suitable for a client. Baird and Raymond
James lacked policies and procedures to consider an entire category of
cost information and didn’t fully evaluate whether these wrap fee
programs were a good fit for their clients.”
Contact the securities fraud attorneys at Meyer Wilson today if your financial
adviser failed to give you accurate information when determining the suitability
of a transaction. You may be able to file a claim to recover your losses,
and we handle all cases on a contingency fee basis so you won’t
owe us a cent in legal fees until we are successful. Fill out our online
form to give us more information about your case.