Advisor Group Firms Avoid Fines Over Sales Charge Waivers

Posted on February 9th, 2023 at 2:28 PM
Advisor Group Firms Avoid Fines Over Sales Charge Waivers

From the Desk of Jim Eccleston at Eccleston Law.

The Financial Industry Regulatory Authority (FINRA) previously had ordered three Advisor Group financial advisory firms to pay nearly $515,000 in restitution for failing to apply sales charge waivers to certain 529 plan investors during a five-year period.

However, FINRA has decided to forgive the fines because the firms “provided substantial assistance” to the investigation, according to the settlement. FINRA determined that there was no “reasonable” supervisory system for 529 plan rollovers at Securities America, Royal Alliance Associates, and SagePoint Financial. After FINRA learned of the issue during a routine review, Advisor Group launched an internal investigation of Royal Alliance, SagePoint and other firms to pinpoint clients who did not appropriately receive sales charge waivers. Advisor Group additionally employed a third-party consultant to identify impacted clients and “promptly” design a plan to provide restitution, according to the settlement.

The majority of 529 college savings plans feature upfront sales charge waivers on Class A funds when undergoing rollovers state-to-state. However, the three firms failed to train advisors or have a system designed to flag occasions where clients did not receive waivers between 2015 and 2020, according to FINRA.

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, advisors, law, finra

Return to Archive

TESTIMONIALS

Previous
Next

Thank You from the bottom of our hearts for all you have done for us. When we realized this was a very bad investment - we did not know where to turn for help. Then we received your name. When we called you - you were so kind to us and then agreed to help us. For this we are so very grateful. The world would be a much nicer place if there were more people like the two of you in it. We will always remember all the help and kindness you have shown us. Thank you so very very much for everything.

Wayne and Judy S.

LATEST NEWS AND ARTICLES

July 15, 2025
Former Advisor Sues Prime Capital Again Over Unpaid Equity Redemption

A former San Diego-based advisor has filed a second lawsuit against Prime Capital Financial, alleging breach of contract after the firm failed to honor agreed-upon terms related to his equity buyout.

July 14, 2025
Wisconsin Man Charged in $15.8 Million Ponzi Scheme Disguised as Investment Advisory Business

Federal authorities have charged a Wisconsin man with orchestrating a multimillion-dollar Ponzi scheme that defrauded more than 120 investors over six years.

July 11, 2025
FINRA Advances Proposal to Allow Limited Use of Performance Projections

The Financial Industry Regulatory Authority (“FINRA”) is moving forward with a proposal that would give broker-dealers limited ability to market performance projections and targeted returns under specific conditions.