Utah is part of a $17 million settlement with investment firm Edward D. Jones & Co. following a four-year investigation by multiple states. The investigation revealed practices such as front-loading commissions and inadequate supervision. Edward Jones will pay approximately $320,000 to Utah to resolve the allegations.
Utah is participating in a $17 million settlement with investment firm Edward D. Jones & Co. concluding a four-year investigation by multiple states. The settlement stems from a probe led by 14 state securities regulators, including Utah's Division of Securities, which found Edward Jones engaged in several unacceptable practices.
The investigation revealed that Edward Jones front-loaded commissions for Class A mutual fund shares when customers sold or transferred the shares sooner than planned. Additionally, the firm was found to have gaps in its supervisory systems. The investigation also uncovered that Edward Jones retained millions in brokerage commissions that could have offset fees for customers who transferred to advisory accounts between 2016 and 2018. This allegedly occurred despite the firm encouraging clients to transfer after the implementation of a 2016 U.S. Department of Labor rule regarding fiduciary duty obligations for retirement brokerage accounts. Regulators in Utah and other states concluded that Edward Jones failed to establish and maintain a supervisory system compliant with securities laws and regulations. As part of the settlement, Edward Jones will pay an administrative fine of approximately $320,000 to Utah and the other 49 states, Washington, D.C., the U.S. Virgin Islands, and Puerto Rico. Utah will receive $320,754.72, which will be deposited into the Investor Education Fund. This fund supports enforcement actions and consumer education regarding safe investment practices, including efforts to prevent fraud and other predatory behaviors. Margaret Woolley Busse, executive director of the Utah Department of Commerce, emphasized the state's commitment to protecting Utah investors. She stated, 'We will continue to work with our regulatory partners to ensure that Utah's securities markets operate fairly and transparently.
INVESTMENT PRACTICES EDWARD JONES & CO. SETTLEMENT SECURITIES REGULATION UTAH DEPARTMENT OF COMMERCE
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