Finra fines Citigroup $100,000 for overcharging clients

Investors placed in the wrong mutual fund share classes were overcharged by more than $260,000

Sep 10, 2018 @ 1:34 pm

By Jeff Benjamin

Citigroup Global Markets Inc. has been fined $100,000 by the Financial Industry Regulatory Authority Inc. for failing to properly supervise the sale of mutual funds to certain retirement plan and charitable organization customers.

According to Finra, between January 2011 and September 2016, customers who were eligible to purchase no-load mutual fund shares were instead sold funds with sales loads and higher ongoing expenses.

(More:Finra orders Citi to pay $4 million in wrongful dismissal case)

In May 2016, after Finra initiated an examination of CGMI, it started its own review of the sales practices, according to Finra.

The Finra report found that approximately 274 customer accounts purchased mutual fund shares without receiving the appropriate sales-charge waiver.

CGMI estimates that during the relevant period, customers were overcharged $264,844.

As part of the settlement, CGMI agreed to pay $309,093 of restitution to eligible customers.

"We are pleased to have resolved this matter," said Citi spokesman Drew Benson.

0
Comments

What do you think?

View comments

Recommended for you

Featured video

INTV

How interest rates have affected different types of insurance

Social media and engagement editor Scott Kleinberg and reporter Greg Iacurci discuss a common theme in this week's popular insurance stories.

Latest news & opinion

Joe Duran has a game plan, and anyone can play

The CEO of United Capital built a formula for holistic financial planning that any firm can tap into — for a price.

LPL video about private equity looks like a swipe at Cetera

Recruiting video warns about potential consequences for advisers when a PE firm buys a broker-dealer.

Ladenburg chairman Phillip Frost steps down

The SEC charged Frost with fraud earlier this month.

Envestnet Tamarac partners with Schwab, TD on digital account openings

Auto-filling documents designed to make onboarding more efficient for RIAs and more convenient for clients.

Wells Fargo plans to cut staff up to 10% within next three years

Bank is struggling to cut spending amid regulatory fines and higher legal costs stemming from scandals.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print