Sagepoint Financial, Inc., a brokerage firm headquartered in Phoenix, Arizona, has been censured and fined $75,000.00 by Financial Industry Regulatory Authority (FINRA) by consenting to findings that the firm failed to apply sales charge waivers on customers’ purchases of mutual funds when customers were eligible, and failed to supervise the application of sales charge waivers. Letter of Acceptance, Waiver and Consent, No. 2017054229301 (Dec. 20, 2017).

According to the AWC, from January 1, 2011 to September 30, 2017, the firm did not apply mutual fund sales charge waivers to purchases made by customers that were eligible for them. Evidently, the firm instead executed sales of class A mutual fund shares containing an up-front sales load, or placed them in costlier class B or C mutual fund shares.

The AWC stated that the firm did not supervise the sales charge waiver application for mutual fund sales. Apparently, financial advisors were called upon by the firm to make determinations of sales charge waivers that applied to transactions; however, the firm never furnished reasonable procedures or written policies to advisors to help them make the waiver determinations. The AWC stated that no written procedures had been established by the firm to detect when applicable waivers had been referenced in mutual fund prospectuses.

The AWC additionally revealed that the firm did not provide adequate notification to advisors or train them when sales charge waivers were available for customers, and had not set forth protocols to identify when the waivers were not provided. FINRA found that the firm’s supervisory failures in this respect were violative of FINRA Rules 2010 and 3110, and NASD Conduct Rule 3010.

According to the AWC, an examination had been conducted by the firm in May of 2016 to identify the extent to which it failed to provide waivers to customers. Evidently, one-hundred forty accounts contained purchases of mutual fund shares where waivers should have been applied but were not. Consequently, since January 1, 2011, customers were disadvantaged by overpaying an estimated $170,361.00.

FINRA Public Disclosure confirms that Sagepoint Financial has been referenced in eleven additional regulatory infractions as well as eleven customer initiated investment related arbitration claims pertaining to accusations of the firm’s improper business activities.

The information contained herein has been obtained from reliable sources however may not be accurate and is not guaranteed by us. Readers are encouraged to undertake their own independent investigation and evaluation of the relevant facts. All claims and allegations are subject to adjudication, decisions may be subject to appeal, and no inference is intended, nor should any inference be made from any information contained herein from any source.

This posting and the information on our website is for general information purposes only. This content , should be not considered legal advice, and any responses, comments, e-mails, other communications do not form any attorney client relationship. Attorney Advertisement. See Important Disclaimer

Guiliano Law Firm

Our practice is limited to the representation of investors. We accept representation on a contingent fee basis, meaning there is no cost to you unless we make a recovery for you. There is never any charge for a consultation or an evaluation of your claim. For more information, contact us at (877) SEC-ATTY.

For more information concerning common claims against stockbrokers and investment professionals, please visit us at stockbrokerfraud.com

To learn more about FINRA Securities Arbitration, and the legal process, please visit us at securitiesarbitrations.com

Tags:

No comments yet.

Leave a Reply

Name (required)

Email (will not be published) (required)

Website

%d bloggers like this: