12.13.18
SEC Sending Letters To Hybrid RIAs That Failed To Self-Report 12b-1 Fees
by: Tracey Longo
Beginning last week, the SEC's Division of Enforcement began sending request letters to targeted dually-registered investment advisors (RIAs) with 12b-1 mutual fund shares on their books, asking them to report, in great detail, every fund with such sales loads. The crackdown by the SEC is the second phase of the “carrot and stick” approach the agency began in February when it launched its voluntary Share-Class Initiative program to encourage firms to self-report their selection of more expensive share classes that paid 12b-1 fees when a lower cost share class for the same fund was available to clients. Advisors were also required to reimburse customers for the fees. The voluntary program ended in June.
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