Investors Capital Corp., J.P. Turner & Co. and VSR Financial Services to pay restitution
According to The Financial Industry Regulatory Authority, the regulator has censured three former Cetera firms for selling Class A shares with a front-end load, or Class B or Class C shares to customers who were eligible for Class A shares without a load.
According to the AWCs, the three firms reportedly charged certain retirement-plan and charitable-organization customers higher-priced versions of the same funds that the customers were eligible to buy at lower cost.
All three firms allegedly failed to establish and maintain written procedures to identify applicable sales charge waivers in fund prospectuses for eligible customers.
FINRA said the firms failed to adequately notify and train their financial advisers about the lower-cost funds. They also failed to adopt adequate controls to detect instances in which their brokers did not provide sales charge waivers to eligible customers for their mutual fund purchases.
Cetera closed J.P. Turner in 2015 and absorbed Investors Capital Corp. into Cetera Advisors in 2016. VSR became a part of Summit Brokerage Services in 2016.
Investigating Potential Claims
The White Law Group is investigating the liability that brokerage firms may have for losses sustained by their clients. Brokerage firms are required to adequately supervise their agents to ensure they are complying with FINRA rules. If it is determined that the broker dealer failed to supervise their agents, they can be held responsible for losses in a FINRA arbitration claim.
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The foregoing information, which is all publicly available on FINRA’s website, is being provided by The White Law Group. The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Franklin, Tennessee.
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