A firm settled FINRA charges for providing employer sponsors and employee participants with inaccurate information regarding the retirement plans offered by the firm, in violation of FINRA Rule 2210 ("Communications with the Public") and FINRA Rule 3110 ("Supervision").
According to FINRA's Letter of Acceptance, Waiver and Consent, the firm gave employees inaccurate information regarding the expense ratio and historical performance of numerous investment options in the retirement plans. FINRA found that the firm also (i) conveyed inaccurate third-party ratings for the retirement plans' investment options and (ii) failed to provide "Seven-Day Yield" information. Further, FINRA alleged that during the period of the violations - from January 2010 to June 2017 - the firm did not establish or maintain supervisory procedures to achieve compliance with certain FINRA advertising and supervision rules.
To settle the charges, the member firm agreed (i) to a censure, (ii) to a fine of $1,000,000 and (iii) to retain a qualified independent consultant to conduct a comprehensive review of the firm's compliance with FINRA rules.
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