SEC takes aim at second Cetera broker-dealer

On Friday, the Securities and Exchange Commission added Cetera Advisor Networks, a registered investment adviser and broker-dealer, as a defendant to an earlier lawsuit against Cetera Advisors. The August complaint alleged that Cetera Advisors had breached its fiduciary duty and defrauded its retail advisory clients in connection with sales of mutual funds, earning more than $10 million to which it was not entitled. [Recommended video:​ What advice industry needs to do as nation's diversity evolves] The addition of Cetera Advisor Networks to the SEC's lawsuit brings Cetera's alleged unlawful gains that the Commission seeks to recover to over $21 million. According to the SEC's amended complaint, Cetera Advisor Networks breached its fiduciary duty and defrauded retail advisory clients by failing to disclose conflicts of interest related to the firm's receipt of undisclosed compensation in the form of 12b-1 fees, revenue sharing, administrative fees and mark-ups. A spokeswoman for Cetera, Adriana Senior, did not return a call for comment. The SEC has been cracking down on share-class disclosure by brokerage firms. In March, the SEC said that 79 investment firms had agreed to return $125 million to clients to whom they had sold inappropriate high-fee mutual funds.