Jim Eccleston: State Actions Against Registered Investment Advisers On The Rise

Posted on November 7th, 2013 at 12:37 PM

From the Desk of Jim Eccleston at Eccleston Law Offices:

Financial advisers with $100 million or less in assets are now regulated by the states. In the past, states have been responsible for advisers with $25 million or less in assets. This expansion in oversight for the states has seen an increase in actions against registered investment advisers.

            Investment advisers now make up 23.9% of regulatory actions taken by states, and broker dealers make up 29.2%. Unlicensed individuals who sell securities are the biggest offenders making up 42.5% of these actions. Although the exact number is unclear, this increase in actions is significant enough to raise concerns. 

            Supervision is essential in ensuring advisers act appropriately. Unfortunately, the current industry shift from broker dealers to investment advisers has fostered this growth in regulatory action. More and more, advisers are leaving large firms to practice independently. This change carries a great deal of risk as solo practitioners do not have the same structure and compliance support as large financial institutions. Some of these practices may adhere to regulations and find success, but there are others who make poor investments, sometimes unknowingly, at the expense of their clients. The investment industry should heed the warnings of these trends.

The attorneys of Eccleston Law represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 50 years in delivering the highest quality legal services.

Related Attorneys: James J. Eccleston


Return to Archive



If you find yourself in trouble with the regulators, call Eccleston Law, you won't regret it.

Rick R.


August 12, 2022
SEC Charges J.P. Morgan, UBS, and TradeStation for Deficiencies Pertaining to the Prevention of Customer Identify Theft

The Securities and Exchange Commission (SEC) has charged J.P. Morgan Securities, UBS Financial Services, and TradeStation Securities over deficiencies in their programs designed to prevent client identify theft, which violates the SEC’s Identity Theft Red Flags Rule, or Regulation S-ID.

August 11, 2022
FINRA Suspends Former Schwab Advisor for Failing to Disclose Felony Charges

The Financial Industry Regulatory Authority (FINRA) has suspended a former Charles Schwab advisor who allegedly failed to disclose multiple felony charges.

August 10, 2022
UBS Wealth Group’s Legal Costs Skyrocket in Q2

UBS Wealth’s litigation expenses have substantially spiked in the second quarter as the firm has faced a host of investor complaints and regulatory probes into UBS’ volatile Yield Enhancement Strategy (YES).