Investacorp Censured by FINRA for Leniency on Fund Sales
Investacorp, a subsidiary of Ladenburg Thalmann Financial Services Inc., has agreed to settle with the Financial Industry Regulatory Authority (FINRA) for almost $250,000 in restitution for overcharging clients.
FINRA censured Investacorp for procedural failures that were meant to detect that brokers were selling high-priced funds to investors who could have paid less.
According to the regulatory agency, between July 1, 2009, and July 5, 2016, some retirement plan and charitable organization customers were sold share classes with back-end sales charges, as well as higher ongoing fees and expenses. These Investacorp clients were eligible to purchase shares in certain mutual funds without a front-end sales charge.
According to FINRA, the company’s internal review estimated that 465 customer accounts had purchased mutual fund shares for which a sales charge waiver was available but not applied. Since July 1, 2009, it is estimated that customers were overcharged by approximately $215,092 for mutual fund purchases.
Investacorp will Pay Restitution
Investacorp has agreed to pay restitution to eligible customers as part of its settlement with FINRA. The estimated total amounts to $247,886, which is equal to the amount that the company’s customers were overcharged, including interest.
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If you lost money as a result of Investacorp’s stockbrokers or have been the victim of stockbroker misconduct, contact a qualified securities fraud attorney today.
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