Tr?id=566623520170033&ev=PageView&noscript=1

SEC Charges First Horizon Advisors for Regulation Best Interest Violations

Posted on October 15th, 2024 at 4:09 PM
SEC Charges First Horizon Advisors for Regulation Best Interest Violations

From the desk of Jim Eccleston at Eccleston Law

The Securities and Exchange Commission (SEC) has charged First Horizon Advisors, LLC, a registered broker-dealer, with violating Regulation Best Interest (Reg BI). The charges stem from the firm’s failure to maintain and enforce policies designed to ensure compliance with Reg BI, particularly regarding recommendations of structured notes.

In 2021, First Horizon merged with another broker-dealer, which resulted in the transfer of 5,000 customer brokerage accounts. However, due to system incompatibility between the two firms, First Horizon lacked the necessary customer data to properly review structured note recommendations for Reg BI compliance. Additionally, registered representatives from the merging firm were unable to access First Horizon’s exception reporting system, which prevented them from reviewing flagged transactions as required by the firm's procedures.

Without admitting or denying the SEC’s findings, First Horizon agreed to a cease-and-desist order, a censure, and a $325,000 civil penalty. This case highlights the importance of maintaining robust compliance systems, particularly during mergers.

 

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

Tags: eccleston, eccleston law, sec

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

Thank you for your professional assistance with this matter. You are very good at what you do.

John T.

LATEST NEWS AND ARTICLES

1780328948 Law
June 1, 2026
Massachusetts Regulators Fine Fidelity $1.25 Million Over Data Breach Allegations

Massachusetts regulators has fined Fidelity Brokerage Services $1.25 million over allegations that the firm failed to adequately protect customer information and properly notify all affected individuals following a significant data breach.

1780079651 Law
May 29, 2026
SEC Investigating Fraud Allegations in Private Credit Industry

The Securities and Exchange Commission (SEC) actively is investigating allegations of fraud involving private credit firms, signaling continued regulatory scrutiny of the rapidly expanding sector.

1779992462 Law
May 28, 2026
FINRA Adopts New Rules to Accelerate Arbitration for Elderly and Vulnerable Investors

The Financial Industry Regulatory Authority (FINRA) has adopted amendments to its Code of Arbitration Procedure to expedite arbitration proceedings for certain eligible parties, according to regulatory updates.