5 big compliance lessons from recent SEC cases
3. Conflicts of interest will get you every time
Advisory firm Total Wealth Management and owner Jacob Cooper failed to tell clients that the Altus family of funds they were recommending was paying them and others at the firm revenue sharing fees, the SEC said in an April 15 complaint.
Todd Cipperman, managing principal at Cipperman Compliance Services said revenue sharing isn’t illegal, but it might not be possible for a firm to disclose enough to convince examiners there is no conflict. And in a bonus lesson, Mr. Cipperman said firing a compliance consultant — which the firm did, according to the SEC — is a red flag that “something may be amiss.”
Details can be found in our coverage.