SEC settles with City National Rochdale over conflicts of interest

SEC settles with City National Rochdale over conflicts of interest
The bank's RIA unit will pay $30 million into an SEC fund to be distributed to harmed investors.
MAR 03, 2022

City National Rochdale, the wholly-owned registered investment advisory unit of New York-based City National Bank, has agreed to pay more than $30 million to settle charges brought by the SEC that the RIA's undisclosed conflicts of interest defrauded clients.

The Securities and Exchange Commission also censured the firm.

The money that the City National unit pays will be placed into an SEC fund to be distributed to harmed investors, the agency said in a release.

According to the SEC’s order, from at least 2016 through 2019, City National Rochdale, which has discretionary authority over client accounts, didn't let clients know that it was investing their assets in proprietary mutual funds that generated fees for the RIA and its affiliates, rather than in the funds of competitors that might charge lower fees.

The order also found that from at least 2016 until 2019, CNR failed to inform some prospective clients that they could invest in the RIA’s proprietary funds at a lower cost. Clients who opened accounts with certain affiliates of CNR didn't pay 12b-1 fees, but most clients who invested with CNR through their own financial advisers did.

Finra should retain remote supervision, says SIFMA's Bentsen

Latest News

Trump asks bank CEOs to pitch Fannie, Freddie stock offering
Trump asks bank CEOs to pitch Fannie, Freddie stock offering

Wall Street leaders propose ways to monetize the mortgage giants.

Raymond James, Osaic laud new bank partnerships
Raymond James, Osaic laud new bank partnerships

A Texas-based bank selects Raymond James for a $605 million program, while an OSJ with Osaic lures a storied institution in Ohio from LPL.

Bessent backpedals after blowback on 'privatizing Social Security' comments
Bessent backpedals after blowback on 'privatizing Social Security' comments

The Treasury Secretary's suggestion that Trump Savings Accounts could be used as a "backdoor" drew sharp criticisms from AARP and Democratic lawmakers.

Alternative investment winners and losers in wake of OBBBA
Alternative investment winners and losers in wake of OBBBA

Changes in legislation or additional laws historically have created opportunities for the alternative investment marketplace to expand.

Financial advisors often see clients seeking to retire early; Here's what they tell them
Financial advisors often see clients seeking to retire early; Here's what they tell them

Wealth managers highlight strategies for clients trying to retire before 65 without running out of money.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.