Finra dings Edward Jones for underreporting alleged damages in customer complaints
The broker-dealer was censured and fined $40,000 for the infractions.
Over a two-year period, Edward D. Jones & Co. understated alleged damages in nearly 80 customer complaints, according to a settlement announced Wednesday with the Financial Industry Regulatory Authority Inc.
From April 2016 to March 2018, Edward Jones filed 79 standard securities industry registrations for brokers, known as Form U4s in the industry, that reported incorrect amounts for customers’ complaints and potential damages.
In those instances, where Edward Jones reported alleged damages of $5,000, the customers’ complaints specified amounts that in some cases were far greater, according to the settlement.
For example, one complaint sought damages of $93,139 for allegedly excessive sales of securities; another complaint sought damages of $630,000 for allegedly excessive fees and sales charges.
Finra censured and fined Edward Jones $40,000. The firm said it will review its systems and policies regarding the reporting issue.
Registered reps and broker-dealers share a continuing obligation to update promptly a registered representative’s Form U4 if any information changes or becomes inaccurate, according to Finra.
The inaccuracies in the Form U4 filings resulted from a misunderstanding by certain Edward Jones’ associates about the requirements for disclosing customer complaints, according to Finra.
Edward Jones, which neither admitted nor denied the findings in the settlement, is a massive brokerage firm, with 21,752 registered reps and 13,925 branch offices, according to Finra.
“We are pleased the matter has been resolved,” wrote Edward Jones spokesman John Boul in an email.
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