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Monday, December 2 2019

Charges Settled for Additional 16 Self-Reporting Advisory Firms

In late September, the SEC announced settlements with 17 investment advisers for disclosure failures regarding their mutual fund share class selection practices. This action adds to the original 79 firms that were ordered to pay over $125 million. 

Key items to note in the settlements: 

  • 16 had self-reported as part of the Share Class Selection Disclosure Initiative
  • The 16 self-reporting firms were found to be in violation of Section 206(2) of the Investment Advisers Act of 1940. 
  • A $300,000 civil penalty was ordered against one adviser who did not self-report.

“Today’s actions reaffirm the benefits to advisers and their clients for self-reporting as part of the Initiative,” said C. Dabney O’Riordan, Co-Chief of the Asset Management Unit. “They also demonstrate the Commission’s commitment to holding advisers accountable for selecting more expensive investments that eat away at their clients’ investment returns without proper disclosure.”

Read the full article to see a list of all the self-reporting firms charged.