Category Archives: Mutual Fund Sales Charge Abuse

Jarred M Lawson – Former Merrill Lynch Broker-Discloses Termination and Suspension-Jacksonville, FL

June 2017 – Jacksonville, FL

The FINRA records of Jarred M. Lawson,  a  stockbroker who is currently not registered disclose a final regulatory event and a termination.

The Financial Industry Regulatory Authority (FINRA) is the agency that licenses and regulates stockbrokers and brokerage firms. FINRA requires brokers and brokerage firms to report customer complaints and disputes as well as regulatory sanctions. In addition brokers are required to disclose certain financial matters such as personal bankruptcies, judgments and liens.

In March of 2017, agreed to a one year suspension and a $10,000 fine to resolve FINRA allegations that   he made negligent misrepresentations or omissions during telephone calls with customers regarding the sale of mutual funds. Lawson  is suspended in all capacities from April 3, 2017 to April 2, 2018.

In January of 2016, Lawson was discharged from Merrill Lynch who made the following allegation in connection therewith: “conduct involving failure to make disclosures related to mutual fund transactions”.

 Lawson was employed by Merrill Lynch from 11/2012-2/2016 and with Edward Jones from 8/2012-11/2012.

If you have questions about an account  handled by Jarred M. Lawson call for a no charge consultation.

Rex Securities Law , with offices in Boca Raton, FL,  and  Austin, TX,   provides representation to  investors  nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.

Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

Nationwide Representation

Rex Securities Law

TollFree: 877-224-3199

Florida-561 391 1900 

Texas-512-329-2870

George Sefanou-Edward Jones Broker-Discloses Settlement of Customer Dispute

August  2016-Orlando / The Villages, Florida

The FINRA records of George Sefanou ,  a  stock broker who is currently employed by Edward Jones  , disclose a recently settled customer dispute.

The Financial Industry Regulatory Authority (FINRA) is the agency that licenses and regulates stockbrokers and brokerage firms. FINRA requires brokers and brokerage firms to report customer complaints and disputes as well as regulatory sanctions. In addition brokers are required to disclose certain financial matters such as personal bankruptcies, judgments and liens.

In FINRA Case 15-0387, a customer of Edward Jones alleged that Stefanou’s recommendation to transfer their retirement accounts to Edward Jones was unsuitable in that the transfer caused tax consequences and penalties. They also alleged that Stefanou failed to calculate properly IRS Code Section 72T distributions and that a recommendation to purchase mutual funds was unsuitable due to high fees associated with the purchase. That case was recently settled for $50,000.

Stefanou has been employed by Edward Jones since 8/2009.

Rex Securities Law , with offices in Boca Raton, FL,  and  Austin, TX,   provides representation to  investors  nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.

Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

Nationwide Representation

Rex Securities Law

TollFree: 877-224-3199

Florida-561 391 1900 

Texas-512-329-2870

Stephens Inc. Sanctioned by Securities Regulators for Mutual Fund Sales Charge Abuse

October 27, 2015

Stephens, Inc.  entered into a Letter of Acceptance Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA) to resolve allegations that since June 1, 2009, Stephens disadvantaged certain retirement plans and charitable organization customers that were eligible to purchase Class A shares in certain mutual funds without a front-end sales charge. Those customers were instead sold Class A shares with a front-end sales charge or Class B or C shares with back-end sales charges and higher ongoing fees and expenses.

 

FINRA found that during this period, Stephens failed to establish and maintain a supervisory system and procedures reasonably designed to ensure that eligible customers who purchased mutual fund shares received the benefit of applicable sales charge waivers. As a result, Stephens violated NASD Conduct Rule 3010 (for misconduct before December 1,2014), FINRA Rule 3 110 (for misconduct on or after December 1,2014), and FINRA Rule 2010.

AWC No.  2015046029901

Stephens was censured and required to provide a detailed plan to remediate affected customers.

Stephens, Inc., is headquartered in Little Rock, Arkansas, and  has been a FINRA member since 1950. It has more than 430 registered agents and over 25 branch offices, including Texas offices in  Austin, , Dallas, & Houston and Florida offices in St. Petersburg.

Rex Securities Law , with offices in Boca Raton, FL,  and  Austin, TX,   provides representation to  investors  nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.

Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

Nationwide Representation

Rex Securities Law

TollFree: 877-224-3199

Florida-561 391 1900 

Texas-512-329-2870

FEF Distributors and First Eagle Investment Management Charged by SEC with Making Improper Payments

September 21 2015- Washington DC

First Eagle Investment Management and FEF Distributors was charged by the US Securities and Exchange Commission with improperly using mutual fund assets to pay for the marketing and distribution of fund shares, according to a SEC Press Release. 

The SEC alleges that First Eagle and FEF Distributors unlawfully caused First Eagle Funds to pay $25 million for distribution costs rather than making the payments from the company’s assets.

“First Eagle and FEF inappropriately used money belonging to the shareholders of the funds to pay for services clearly intended to market the funds and distribute their shares,” said Andrew J. Ceresney, Director of the SEC’s Enforcement Division.  “Unless part of a 12b-1 plan, the firm should bear those costs, not the shareholders.”

“Mutual fund advisers have a fiduciary duty to manage the conflict of interest associated with fund distribution, namely whether to use their own assets or to recommend to their fund’s board to use the fund’s assets to distribute shares,” said Julie M. Riewe, Co-Chief of the SEC Enforcement Division’s Asset Management Unit.  “First Eagle breached that fiduciary duty by using the funds’ assets rather than its own money to pay for distribution and failed to provide accurate information to the funds’ boards.”

Rex Securities Law , with offices in Boca Raton, FL,  and  Austin, TX,   provides representation to  investors  nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.

Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

Nationwide Representation

Rex Securities Law

TollFree: 877-224-3199

Florida-561 391 1900 

Texas-512-329-2870

Raymond James Agrees to Return $4.4 Million in Mutual Fund Overcharges

July 6, 2015

Raymond James & Associates  entered into a Letter of Acceptance Waiver and Consent (AWC) with the Financial Industry Regulatory Authority (FINRA) to resolve allegations that from July 2009 through December 2014, Raymond James disadvantaged certain retirement plan and charitable organization customers that were eligible to purchase Class A shares without a front-end sales charge but were instead sold Class A shares with a front end sales charge or Class B or C shares with back end sales charges and higher on going fees.

Class A shares typically are subject to a front-end sales charge when originally purchased, and have annual fund expenses, including ongoing distribution and service fees that are typically 0.25percent. The majority of the front-end charge is paid to the selling broker-dealer as a concession.  Investors purchase Class A shares at the applicable Net Asset Value (“NAV”), plus the initial sales charge. Most funds, however, offer certain investors a waiver ofthe initial sales charge associated with Class A shares under certain circumstances.

Class B and C shares typically do not carry a front-end sales charge but have significantly higher fees (typically 1.00 percent) and may be subject to a contingent deferred sales charge .

Some mutual funds offer Class R shares for purchase by retirement plans. Class R shares typically are sold without a front-end sales charge. However,ClassR shares typically have higher fees than Class A shares.

After performing a review in June 2014, Raymond James self reported to FINRA that in over 59,000 transactions, involving over 4,200 accounts, customers were overcharged over $4.1 million. Raymond James agreed to pay restitution of over $4.4 million to the affected customers.

AWC NO. 2015044309001

Raymond James, a subsidiary of Raymond James Financial, is headquartered in St. Petersburg, Florida and has over 3,200 financial advisors nationwide.

Rex Securities Law , with offices in Boca Raton, FL,  and  Austin, TX,   provides representation to  investors  nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.

Most cases handled on a contingent fee basis meaning that you do not pay legal fees unless we are successful.

Nationwide Representation

Rex Securities Law

TollFree: 877-224-3199

Florida-561 391 1900 

Texas-512-329-2870