Next Financial to return $500,000 to clients over fund sales

Next Financial to return $500,000 to clients over fund sales
Texas securities regulator also fines the firm $100,000 for failure to supervise
FEB 14, 2020
Texas securities regulators have ordered Next Financial Group of Houston, Texas, to refund $500,000 to customers whose broker moved them into and out of A-share mutual funds to generate commissions. Next Financial Group also agreed to pay a $100,000 fine for failing to properly supervise the broker, who worked for the firm from 2007 until Sept. 27. [More: Next Financial smacked with $475,000 in fines related to nontraded REITs] The broker, whose name the Texas Securities Commission did not divulge, is no longer registered to sell securities in Texas. “Next Financial Group failed to rein in the agent even though it received hundreds of alerts from the regulatory system it had set up to detect mutual-fund switching,” the commission said in a release. [More: Ponzi schemes top investor threats for 2020, says NASAA]

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