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Some recent SEC Actions

Periodically the SEC publishes actions they take against RIA’s. The SEC publishes months even years after they initiate investigations. What do you think happens to the relationship between the RIA and the custodian/broker dealers they use?

Recently 2 pretty hefty AUM RIA’s were disciplined by the SEC, Frontier Wealth Management and FCG. The compliance violations were significant. These RIA’s used Schwab and Fidelity as custodians. Frontier is a Billion Dollar AUM RIA and FCG merged with Cambridge as the the SEC action was about to be published. I contacted both RIA firms to ask if Schwab or Fidelity terminated their contracts thereby booting them from their platforms. Neither responded.

Schwab claims the size of an RIA does not influence their decision to terminate a relationship. But it does - Schwab only terminates contracts with small AUM RIA’s. For small AUM RIA’s Schwab terminates and notifies all account holders of the RIA.

If you are an account holder at either of these RIA’s - were you notified by Schwab? Were you notified by the RIA of a change in custodian? Or are you unaware?

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Read about how it really works when this happens.

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This company is despicable. Parades around on a white horse as the protector when in fact they are the destroyer. They have one goal - strip investors bare.

Read today’s SEC action against Schwab. They were fined $187M for egregious behavior. They lied to their clients. Maybe they should be kicked off their own platform!!!

Aka David - just threw a rock at Goliath. He filed a lawsuit against Schwab and others . He used a phrase - “Silencing and Retaliation Scheme”. Schwab is a corporate bully out to destroy small RIA’

Broker Dealers seem quite casual, if not indifferent, to informing RIA clients that they have terminated the contract with their advisor. Almost like telling a motorist he left his car lights on. Broker Dealers refer to these individuals as account holders, while RIA's refer to them as clients. If you ask a compliance person at a Broker Dealer how the recipients of the notice of termination are likely to "feel" after receiving notice, they will show you that they have not given the matter much thought, and really don't care. 

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