The Financial Industry Regulatory Authority Inc. has censured SagePoint Financial and fined the unit of Advisor Group $300,000 for its failure to supervise the sales practices of its representatives in connection with unit investment trusts.
Finra said that between January 2013 and December 2017, SagePoint failed to supervise recommendations regarding early rollovers of the investments, which led to customers incurring greater sales charges than if they had held the UITs until maturity. Because of the long-term nature of UITs, their structure and their costs, Finra said that short-term trading of the investments may be unsuitable.
In addition to the fine and censure, SagePoint must provide restitution to customers in the amount of $1.3 million plus interest. The sum represents the sales charges the firm’s customers would not have incurred had they held their investments to maturity.
The collective of groups including CFP Board, the FPA, NAPFA, and XYPN called for continued support in a legal battle to reinforce clients' best interests.
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