CETERA ADVISORS LLC · CRD# 10299 SEC# 8-26892 Main Office Location 4600 SOUTH SYRACUSE STREET SUITE 600 DENVER, CO 80237 Regulated by FINRA Denver Office Mailing Address 4600 SOUTH

BrokerCheck Report

CETERA ADVISORS LLC

Section Title

Report Summary

Firm History

CRD# 10299

1

10

Firm Profile 2 - 9

Page(s)

Firm Operations 11 - 22

Disclosure Events 23

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CETERA ADVISORS LLC

CRD# 10299

SEC# 8-26892

Main Office Location

400 FIRST STREET SOUTHSUITE 300SAINT CLOUD, MN 56301Regulated by FINRA Kansas City Office

Mailing Address

400 FIRST STREET SOUTHSUITE 300SAINT CLOUD, MN 56301

This firm is a brokerage firm and an investmentadviser firm. For more information aboutinvestment adviser firms, visit the SEC'sInvestment Adviser Public Disclosure website at:

Business Telephone Number

800-929-3485

https://www.adviserinfo.sec.gov

Report Summary for this Firm

This report summary provides an overview of the brokerage firm. Additional information for this firm can be foundin the detailed report.

Disclosure Events

Brokerage firms are required to disclose certaincriminal matters, regulatory actions, civil judicialproceedings and financial matters in which the firm orone of its control affiliates has been involved.

Are there events disclosed about this firm? Yes

The following types of disclosures have beenreported:

Type Count

Regulatory Event 11

Civil Event 1

Arbitration 7

Firm Profile

This firm is classified as a limited liability company.

This firm was formed in Delaware on 08/31/2012.

Its fiscal year ends in December.

Firm History

Information relating to the brokerage firm's historysuch as other business names and successions(e.g., mergers, acquisitions) can be found in thedetailed report.

Firm Operations

Is this brokerage firm currently suspended with anyregulator? No

This firm conducts 16 types of businesses.

This firm is affiliated with financial or investmentinstitutions.

This firm has referral or financial arrangements withother brokers or dealers.

This firm is registered with:

• the SEC• 1 Self-Regulatory Organization• 53 U.S. states and territories

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1©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC

https://adviserinfo.sec.gov/firm/summary/10299


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This firm is classified as a limited liability company.

This firm was formed in Delaware on 08/31/2012.

CRD#

This section provides the brokerage firm's full legal name, "Doing Business As" name, business and mailingaddresses, telephone number, and any alternate name by which the firm conducts business and where such name isused.

Firm Profile

Firm Names and Locations

Its fiscal year ends in December.

CETERA ADVISORS LLC

SEC#

10299

8-26892

Main Office Location

Mailing Address

Business Telephone Number

Doing business as CETERA ADVISORS LLC

800-929-3485

Regulated by FINRA Kansas City Office








This section provides information relating to all direct owners and executive officers of the brokerage firm.

Direct Owners and Executive Officers

Firm Profile

Position

Percentage of Ownership

Is this a public reportingcompany?

Position Start Date

Does this owner direct themanagement or policies ofthe firm?

CETERA FINANCIAL GROUP, INC.

SOLE MEMBER

75% or more

No

Domestic Entity

12/2010

Yes

Is this a domestic or foreignentity or an individual?

Legal Name & CRD# (if any):

Position



Position Start Date


BOWMAN, TIMOTHY JOSEPH

PRINCIPAL FINANCIAL OFFICER

Less than 5%

No

Individual

10/2018

Yes

2247374



Position


Position Start Date

HALEY, KRISTY MARIE

ADVISORY CHIEF COMPLIANCE OFFICER

Less than 5%

Individual

11/2015

4022155








Direct Owners and Executive Officers (continued)

Firm Profile




Less than 5%

No

Yes

Position



Position Start Date


HARRISON, BRETT LAMAR

MANAGER AND CHIEF EXECUTIVE OFFICER

Less than 5%

No

Individual

10/2009

Yes

4032238



Position



Position Start Date


KESTERSON, BARBARA JO

PRINCIPAL OPERATIONS OFFICER

Less than 5%

No

Individual

10/2018

Yes

2747533



NEARY, JOSEPH DANIEL

2993505








Firm Profile

Position



Position Start Date


MANAGER

Less than 5%

No

Individual

05/2019

Yes

2993505


Position



Position Start Date


OLSON, GREGORY ALAN

ASSISTANT SECRETARY

Less than 5%

No

Individual

07/2016

Yes

2692482



Position


Position Start Date


RAMOS, RAMON

MONEY LAUNDERING REPORTING OFFICER

Less than 5%

Individual

02/2013

No

2160203









Firm Profile



No

No

Position



Position Start Date


SCHOTT, MARY FRANCES

PRESIDENT

Less than 5%

No

Individual

02/2018

Yes

1453429



Position



Position Start Date


SHELSON, MARK PAUL

TREASURER

Less than 5%

No

Individual

07/2016

Yes

1819252



SMILEY, STANLEY ROBERT

Individual

3004604









Firm Profile

Position



Position Start Date


VICE PRESIDENT

Less than 5%

No

Individual

02/2006

Yes


Position



Position Start Date


VANNOY-PINEDA, KATHLEEN DENISE

SENIOR VICE PRESIDENT, BD CHIEF COMPLIANCE OFFICER ANDSECRETARY

Less than 5%

No

Individual

11/2017

Yes

1347526








This section provides information relating to any indirect owners of the brokerage firm.

Indirect Owners

Firm Profile

ARETEC GROUP, INC

SOLE MEMBER

CETERA FINANCIAL HOLDINGS, INC.

75% or more

No

Domestic Entity

04/2014

Yes



Company through whichindirect ownership isestablished

Relationship to Direct Owner

Relationship Established




CETERA FINANCIAL HOLDINGS, INC

SOLE MEMBER

CETERA FINANCIAL GROUP, INC

75% or more

No

Domestic Entity

11/2009

Yes









GC TWO HOLDINGS, INC.

GC TWO INTERMEDIATE HOLDINGS, INC.

Domestic Entity









Indirect Owners (continued)

Firm Profile

OWNER


Other General Partners

No

10/2018

Yes








OWNER

ARETEC GROUP, INC.

Other General Partners

No

Domestic Entity

10/2018

Yes














Firm History

This section provides information relating to any successions (e.g., mergers, acquisitions) involving the firm.

01/01/2013Date of Succession:

This firm was previously: MULTI-FINANCIAL SECURITIES CORPORATION

10299Predecessor CRD#:

Description CETERA ADVISORS LLC IS THE SUCCESSOR BY MERGER TO MULTI-FINANCIAL SECURITIES CORPORATION AND WILL BE ASSUMINGSUBSTANTIALLY ALL OF THE ASSETS AND LIABILITIES OF THEPREDECESSOR FIRM. THIS SUCCESSION DOES NOT INVOLVE ASUBSTANTIAL CHANGE IN OWNERSHIP AND/OR CONTROL.






Firm Operations

RegistrationsThis section provides information about the regulators (Securities and Exchange Commission (SEC), self-regulatoryorganizations (SROs), and U.S. states and territories) with which the brokerage firm is currently registered andlicensed, the date the license became effective, and certain information about the firm's SEC registration.

This firm is currently registered with the SEC, 1 SRO and 53 U.S. states and territories.

SEC Registration Questions

This firm is registered with the SEC as:

A broker-dealer:

A broker-dealer and government securities broker or dealer:

A government securities broker or dealer only:

This firm has ceased activity as a government securities broker or dealer:

Yes

No

No

No

Federal Regulator Status Date Effective

SEC Approved 12/01/1981

Self-Regulatory Organization Status Date Effective

FINRA Approved 01/04/1982






Firm Operations

Registrations (continued)

U.S. States &Territories

Status Date Effective

Alabama Approved 02/21/1984

Alaska Approved 02/02/1990

Arizona Approved 11/18/1985

Arkansas Approved 02/23/1990

California Approved 06/22/1983

Colorado Approved 02/01/1983

Connecticut Approved 11/22/1988

Delaware Approved 04/12/1989

District of Columbia Approved 10/18/1986

Florida Approved 08/23/1983

Georgia Approved 11/18/1983

Hawaii Approved 10/17/1990

Idaho Approved 12/06/1985

Illinois Approved 09/28/1984

Indiana Approved 10/10/1984

Iowa Approved 07/14/1983

Kansas Approved 10/14/1982

Kentucky Approved 03/27/1985

Louisiana Approved 05/17/1985

Maine Approved 01/06/1989

Maryland Approved 02/10/1987

Massachusetts Approved 01/04/1989

Michigan Approved 10/22/1986

Minnesota Approved 11/15/1984

Mississippi Approved 06/29/1989

Missouri Approved 07/19/1983

Montana Approved 06/29/1988

Nebraska Approved 08/06/1984

Nevada Approved 07/18/1983

New Hampshire Approved 05/10/1990

New Jersey Approved 01/03/1989

New Mexico Approved 10/29/1982

New York Approved 03/24/1986

U.S. States &Territories

Status Date Effective

North Carolina Approved 04/03/1985

North Dakota Approved 08/10/1988

Ohio Approved 08/01/1983

Oklahoma Approved 01/29/1985

Oregon Approved 07/08/1987

Pennsylvania Approved 07/11/1985

Puerto Rico Approved 09/23/2014

Rhode Island Approved 04/18/1990

South Carolina Approved 07/28/1986

South Dakota Approved 07/25/1983

Tennessee Approved 07/27/1987

Texas Approved 11/04/1983

Utah Approved 01/01/1985

Vermont Approved 07/18/1990

Virgin Islands Approved 04/25/2006

Virginia Approved 03/02/1984

Washington Approved 06/02/1986

West Virginia Approved 12/01/1989

Wisconsin Approved 03/24/1986

Wyoming Approved 04/02/1985






Firm Operations

Types of BusinessThis section provides the types of business, including non-securities business, the brokerage firm is engaged in orexpects to be engaged in.

Other Types of Business

This firm does effect transactions in commodities, commodity futures, or commodity options.This firm does not engage in other non-securities business.

Non-Securities Business Description:

This firm currently conducts 16 types of businesses.

Types of Business

Broker or dealer retailing corporate equity securities over-the-counter

Broker or dealer selling corporate debt securities

Underwriter or selling group participant (corporate securities other than mutual funds)

Mutual fund retailer

Municipal securities broker

Broker or dealer selling variable life insurance or annuities

Solicitor of time deposits in a financial institution

Broker or dealer selling oil and gas interests

Put and call broker or dealer or option writer

Investment advisory services

Broker or dealer selling tax shelters or limited partnerships in primary distributions

Non-exchange member arranging for transactions in listed securities by exchange member

Private placements of securities

Broker or dealer involved in a networking, kiosk or similar arrangment with a: bank, savings bank or association, orcredit union

Broker or dealer involved in a networking, kiosk or similar arrangment with a: insurance company or agency

Other - 10Y MULTI-FINANCIAL SECURITIES CORPORATION IS REGISTERED WITH THE US SECURITIES ANDEXHCANGE COMMISSION AS A REGISTERED INVESTMENT ADVISER (RIA). MULTI-FINANCIAL SECURITIESCORPORATION IS REGISTERED WITH THE NATIONAL FUTURES ASSOCIATION.






Firm Operations

Clearing Arrangements

This firm does not hold or maintain funds or securities or provide clearing services for other broker-dealer(s).

Introducing Arrangements

This firm does refer or introduce customers to other brokers and dealers.

Name: PERSHING LLC

Business Address: 1 PERSHING PLAZA320 W GROVE STREETJERSEY CITY, NJ 07399

CRD #: 7560

Effective Date: 01/01/1985

Description: FULLY DISCLOSED CUSTOMER CLEARING AGREEMENT






Firm Operations

Industry Arrangements

This firm does have books or records maintained by a third party.

Name: BIZNEWS24.COM, INC. D/B/A PINPOINT GLOBAL COMMUNICATIONS

Business Address: 9 TRAFALGAR SQUARESUITE 150NASHUA, NH 03063


Description: ELECTRONIC STORAGE MEDIA FOR CERTAIN BOOKS AND RECORDSON OR AFTER MAY 1, 2020.

Name: FMG SUITE, LLC

Business Address: 12395 WORLD TRADE DR #200SAN DIEGO, CA 92128


Description: ELECTRONIC RECORD KEEPER OF SUPERVISORY AND COMPLIANCEPOLICIES AND PROCEDURES.

Name: NATIONAL REGULATORY SERVICES, A DIVISION OF ACCUITY, INC.

Business Address: 323 - A MAIN STREETLAKEVILLE, CT 06039


Description: BRANCH INSPECTION MODULES FOR MONITORING AND RECORDRETENTION

Name: MARKETINGPRO, INC.

Business Address: 14525 SW MILLIKAN WAY#78359BEAVERTON, OR 97005


Description: WEB BASED SALES LITERATURE AND RECORD RETENTION SYSTEM

Name: SMARSH

Business Address: 851 SW 6TH AVE #800PORTLAND, OR 97204


Description: ELECTRONIC RECORD KEEPER FOR ARCHIVING EMAILS, INSTANTMESSAGES, SOCIAL MEDIA AND TRADE BLOTTERS.






Firm Operations

Industry Arrangements (continued)

This firm does not have accounts, funds, or securities maintained by a third party.

This firm does not have customer accounts, funds, or securities maintained by a third party.

Control Persons/Financing

Description: ELECTRONIC RECORD KEEPER FOR ARCHIVING EMAILS, INSTANTMESSAGES, SOCIAL MEDIA AND TRADE BLOTTERS.

Name: ALBRIDGE SOLUTIONS, INC.

Business Address: ONE PERSHING PLAZAJERSEY CITY, NJ 07399


Description: ELECTRONIC RECORD KEEPER FOR ORDER TICKETS.

Name: IRON MOUNTAIN INFORMATION MANAGEMENT, LLC

Business Address: 4577 E 46TH AVEDENVER, CO 80239


Description: HARD COPY OFFSITE STORAGE OF GENERAL BD RECORDS.

Name: IRON MOUNTAIN INFORMATION MANAGEMENT, LLC

Business Address: 700 DISTRIBUTION DRIVEATLANTA, GA 30336


Description: HARD COPY OFFSITE STORAGE OF GENERAL BD RECORDS.

Name: VERITAS TECHNOLOGIES, INC.

Business Address: 2780 SKYPARK DRIVE, #300TORRANCE, CA 90505


Description: ELECTRONIC RECORD KEEPER FOR ARCHIVING EMAILS, INSTANTMESSAGES AND TRADE BLOTTERS.

Name: DOCUPACE TECHNOLOGIES, INC.

Business Address: 201 S BARRINGTON AVE, #215LOS ANGELES, CA 90025


Description: ELECTRONIC RECORD KEEPER FOR GENERAL ACCOUNTDOCUMENTATION AND PROCESSING






Firm Operations

Industry Arrangements (continued)

This firm does not have individuals who control its management or policies through agreement.

This firm does not have individuals who wholly or partly finance the firm's business.






Firm Operations

Organization AffiliatesThis section provides information on control relationships the firm has with other firms in the securities, investmentadvisory, or banking business.

This firm is, directly or indirectly:

· in control of· controlled by· or under common control withthe following partnerships, corporations, or other organizations engaged in the securities or investmentadvisory business.

Yes

No

No

11/16/2016

200 N PACIFIC COAST HWY STE 1300EL SEGUNDO, CA 90245

285648

CETERA ADVISORY SERVICES LLC is under common control with the firm.

APPLICANT AND AFFILIATE ARE UNDER COMMON CONTROL OF ARETECGROUP, INC.

Description:

Investment AdvisoryActivities:

Securities Activities:

Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

Yes

No

No

04/29/2014

595 SOUTH FEDERAL HIGHWAYBOCA RATON, FL 33432

109485

SUMMIT FINANCIAL GROUP INC is under common control with the firm.

APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFARETEC GROUP, INC.

Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:






Firm Operations

Organization Affiliates (continued)APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFARETEC GROUP, INC.

Description:

Yes

No

No

04/29/2014

15455 CONWAY ROAD2ND FLOORCESTERFIELD, MO 63017

137888

FIRST ALLIED ADVISORY SERVICES, INC. is under common control with the firm.


Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

No

Yes

No

04/29/2014

655 WEST BROADWAY12TH FLOORSAN DIEGO, CA 92101

32444

FIRST ALLIED SECURITIES, INC. is under common control with the firm.


Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

01/03/2013


165436

CETERA INVESTMENT MANAGEMENT LLC is under common control with the firm.

Effective Date:

Business Address:

CRD #:






Firm Operations

Organization Affiliates (continued)

Yes

No

No

01/03/2013

APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFCETERA FINANCIAL GROUP, INC.

Description:



Country:

Foreign Entity:

Effective Date:

Yes

No

No

06/02/2012

200 N. MARTINGALE RDSCHAUMBURG, IL 60173

105644

CETERA INVESTMENT ADVISERS LLC is under common control with the firm.


Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

No

Yes

No

04/02/2012

200 N. MARTINGALE RD.SCHAUMBURG, IL 6173

10358

CETERA FINANCIAL SPECIALISTS LLC is under common control with the firm.


Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:






Firm Operations



Description:

Yes

Yes

No

12/13/2000


13572

CETERA ADVISOR NETWORKS LLC is under common control with the firm.


Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

No

Yes

No

09/01/2000

400 FIRST STREET SOUTHSUITE300ST. CLOUD, MN 56301

15340

CETERA INVESTMENT SERVICES LLC is under common control with the firm.


Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

This firm is not directly or indirectly, controlled by the following:

· bank holding company· national bank· state member bank of the Federal Reserve System






Firm Operations


· state non-member bank· savings bank or association· credit union· or foreign bank






Disclosure Events

All firms registered to sell securities or provide investment advice are required to disclose regulatory actions, criminal orcivil judicial proceedings, and certain financial matters in which the firm or one of its control affiliates has been involved.For your convenience, below is a matrix of the number and status of disclosure events involving this brokerage firm orone of its control affiliates. Further information regarding these events can be found in the subsequent pages of thisreport.

Final On AppealPending

Regulatory Event 0 11 0

Civil Event 1 0 0

Arbitration N/A 7 N/A






Disclosure Event Details

What you should know about reported disclosure events:

1. BrokerCheck provides details for any disclosure event that was reported in CRD. It also includessummary information regarding FINRA arbitration awards in cases where the brokerage firm wasnamed as a respondent.

2. Certain thresholds must be met before an event is reported to CRD, for example: o A law enforcement agency must file formal charges before a brokerage firm is required to disclose a

particular criminal event.3. Disclosure events in BrokerCheck reports come from different sources:

o Disclosure events for this brokerage firm were reported by the firm and/or regulators. When the firmand a regulator report information for the same event, both versions of the event will appear in theBrokerCheck report. The different versions will be separated by a solid line with the reporting sourcelabeled.

4. There are different statuses and dispositions for disclosure events: o A disclosure event may have a status of pending, on appeal, or final.

§ A "pending" event involves allegations that have not been proven or formally adjudicated.§ An event that is "on appeal" involves allegations that have been adjudicated but are currently

being appealed.§ A "final" event has been concluded and its resolution is not subject to change.

o A final event generally has a disposition of adjudicated, settled or otherwise resolved.§ An "adjudicated" matter includes a disposition by (1) a court of law in a criminal or civil matter,

or (2) an administrative panel in an action brought by a regulator that is contested by the partycharged with some alleged wrongdoing.

§ A "settled" matter generally involves an agreement by the parties to resolve the matter.Please note that firms may choose to settle customer disputes or regulatory matters forbusiness or other reasons.

§ A "resolved" matter usually involves no payment to the customer and no finding ofwrongdoing on the part of the individual broker. Such matters generally involve customerdisputes.

5. You may wish to contact the brokerage firm to obtain further information regarding any of thedisclosure events contained in this BrokerCheck report.

Regulatory - Final

This type of disclosure event involves (1) a final, formal proceeding initiated by a regulatory authority (e.g., a statesecurities agency, self-regulatory organization, federal regulator such as the U.S. Securities and Exchange Commission,foreign financial regulatory body) for a violation of investment-related rules or regulations; or (2) a revocation orsuspension of the authority of a brokerage firm or its control affiliate to act as an attorney, accountant or federalcontractor.

Disclosure 1 of 11

Reporting Source: Regulator

Allegations: DFR ALLEGED VIOLATION OF "UNFAIL" CONDUCT AND FAILURE TOSUPERVISE. CETERA ADVISORS, LLC AND MR. MERHOFF NEITHERADMITTED NOR DENIED THE ALLEGATIONS.

Current Status: Final






Initiated By: OREGON DEPARTMENT OF CONSUMER & BUSINESS SERVICES, DIVISIONOF FINANCIAL REGULATION (DFR)

Principal Sanction(s)/ReliefSought:

Cease and Desist

Other Sanction(s)/ReliefSought:

FINAL ORDER TO CEASE AND DESIST; ORDER ASSESSING ANDSUSPENDING, IN PART, THE CIVIL MONETARY PENALTY PROVIDEDVOLUNTARY HEIGHTENED SUPERVISION PLAN IS MAINTAINED; ANDCONSENT TO ENTRY OF ORDER.

Date Initiated: 08/10/2017

Docket/Case Number: S-17-0007-A

URL for Regulatory Action:

Principal Product Type: Equity Listed (Common & Preferred Stock)

Other Product Type(s):

Allegations: DFR ALLEGED VIOLATION OF "UNFAIL" CONDUCT AND FAILURE TOSUPERVISE. CETERA ADVISORS, LLC AND MR. MERHOFF NEITHERADMITTED NOR DENIED THE ALLEGATIONS.

Resolution Date: 08/10/2017

Resolution:

Other Sanctions Ordered:

Sanction Details: DFR ASSESSED A $70,000 CIVIL PENALTY; $35,000 WAS COLLECTED NEARTHE TIME THE FINAL ORDER BECAME EFFECTIVE. THE REMAINED WILLNOT BE COLLECTED UPON PROVIDED THE VOLUNTARY HEIGHTENEDSUPERVISION IS MAINTAINED. THE PENALTY WAS JOINT AND SEVERALBETWEEN CETERA ADVISORS LLC AND MR. MERHOFF.

Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?

No

Sanctions Ordered: Monetary/Fine $70,000.00Cease and Desist/Injunction

Consent

iReporting Source: Firm

Allegations: DFR ALLEGED VIOLATION OF THE SUITABILITY RULE AND FAILURE TOSUPERVISE. CETERA ADVISORS, LLC AND MR. MERHOFF NEITHERADMITTED NOR DENIED THE ALLEGATIONS.







Initiated By: OREGON DEPARTMENT OF CONSUMER & BUSINESS SERVICES, DIVISIONOF FINANCIAL REGULATION (DFR)


Cease and Desist


FINAL ORDER TO CEASE AND DESIST; ORDER ASSESSING ANDSUSPENDING, IN PART, THE CIVIL MONETARY PENALTY PROVIDEDVOLUNTARY HEIGHTENED SUPERVISION PLAN IS MAINTAINED; ANDCONSENT TO ENTRY OF ORDER.


Docket/Case Number: S-17-0007



Allegations: DFR ALLEGED VIOLATION OF THE SUITABILITY RULE AND FAILURE TOSUPERVISE. CETERA ADVISORS, LLC AND MR. MERHOFF NEITHERADMITTED NOR DENIED THE ALLEGATIONS.


Resolution:


Sanction Details: DFR ASSESSED A $70,000 CIVIL PENALTY; $35,000 WAS COLLECTED NEARTHE TIME THE FINAL ORDER BECAME EFFECTIVE. THE REMAINED WILLNOT BE COLLECTED UPON PROVIDED THE VOLUNTARY HEIGHTENEDSUPERVISION IS MAINTAINED. THE PENALTY WAS JOINT AND SEVERALBETWEEN CETERA ADVISORS LLC AND MR. MERHOFF.

Sanctions Ordered: Monetary/Fine $70,000.00Cease and Desist/Injunction

Consent

Disclosure 2 of 11

i


Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT ITDISADVANTAGED CERTAIN RETIREMENT PLAN AND CHARITABLEORGANIZATION CUSTOMERS THAT WERE ELIGIBLE TO PURCHASE CLASSA SHARES IN CERTAIN MUTUAL FUNDS WITHOUT A FRONT-END SALESCHARGE (ELIGIBLE CUSTOMERS). THE FINDINGS STATED THAT MANYMUTUAL FUNDS WAIVE THE UP-FRONT SALES CHARGES ASSOCIATEDWITH CLASS A SHARES FOR CERTAIN RETIREMENT PLANS AND/ORCHARITABLE ORGANIZATIONS. SOME OF THE MUTUAL FUNDS AVAILABLEON THE FIRM'S RETAIL PLATFORM OFFERED SUCH WAIVERS ANDDISCLOSED THOSE WAIVERS IN THEIR PROSPECTUSES.NOTWITHSTANDING THE AVAILABILITY OF THE WAIVERS, THE FIRM FAILEDTO APPLY THE WAIVERS TO MUTUAL FUND PURCHASES MADE BYELIGIBLE CUSTOMERS AND INSTEAD SOLD THE CUSTOMERS CLASS ASHARES WITH A FRONT-END SALES CHARGE OR CLASS B OR C SHARESWITH BACK-END SALES CHARGES AND HIGHER ONGOING FEES ANDEXPENSES. THESE SALES DISADVANTAGED ELIGIBLE CUSTOMERS BYCAUSING SUCH CUSTOMERS TO PAY HIGHER FEES THAN THEY WEREACTUALLY REQUIRED TO PAY. THE DIFFERENT SALES CHARGES,BREAKPOINTS, WAIVERS AND FEES ASSOCIATED WITH DIFFERENT SHARECLASSES AFFECT MUTUAL FUND INVESTORS' RETURNS. IF AN INVESTORQUALIFIES FOR A CLASS A SALES CHARGE WAIVER AND PURCHASEDCLASS A SHARES, THE INVESTOR WILL NOT PAY A FRONT-END SALESLOAD. IN CONTRAST, A PURCHASE OF CLASS B OR C SHARES OF THESAME FUND WILL BE SUBJECT TO HIGHER ONGOING FEES, AS WELL AS APOTENTIAL APPLICATION OF A CONTINGENT DEFERRED SALES CHARGE.THEREFORE, IF AN INVESTOR QUALIFIES FOR A CLASS A SALES CHARGEWAIVER, THERE WOULD BE NO REASON FOR THE INVESTOR TOPURCHASE ANY OTHER CLASS OF SHARES THAT HAS A SALES LOADAND/OR HIGHER ANNUAL EXPENSES. THE FINDINGS ALSO STATED THATTHE FIRM FAILED TO REASONABLY SUPERVISE MUTUAL FUND SALES TOENSURE THAT ELIGIBLE CUSTOMERS WHO PURCHASED MUTUAL FUNDSHARES RECEIVED THE BENEFIT OF APPLICABLE SALES CHARGEWAIVERS. THE FIRM RELIED ON ITS FINANCIAL ADVISORS TO DETERMINETHE APPLICABILITY OF SALES CHARGE WAIVERS BUT FAILED TO MAINTAINADEQUATE WRITTEN POLICIES OR PROCEDURES TO ASSIST FINANCIALADVISORS IN MAKING THIS DETERMINATION. FOR INSTANCE, THE FIRMFAILED TO ESTABLISH AND MAINTAIN WRITTEN PROCEDURES TOIDENTIFY APPLICABLE SALES CHARGE WAIVERS IN FUND'SPROSPECTUSES FOR ELIGIBLE CUSTOMERS. IN ADDITION, THE FIRMFAILED TO ADEQUATELY NOTIFY AND TRAIN ITS FINANCIAL ADVISORSREGARDING THE AVAILABILITY OF MUTUAL FUND SALES CHARGEWAIVERS FOR ELIGIBLE CUSTOMERS. FINALLY, THE FIRM FAILED TOADOPT ADEQUATE CONTROLS TO DETECT INSTANCES IN WHICH THEY DIDNOT PROVIDE SALES CHARGE WAIVERS TO ELIGIBLE CUSTOMERS INCONNECTION WITH THEIR MUTUAL FUND PURCHASES. THE FINDINGSALSO INCLUDED THAT THE FIRM BEGAN A REVIEW TO DETERMINEWHETHER IT PROVIDED AVAILABLE SALES CHARGE WAIVERS TO ELIGIBLECUSTOMERS. BASED ON THIS REVIEW, THE FIRM SELF-REPORTED TOFINRA THAT ELIGIBLE CUSTOMERS MAY NOT HAVE RECEIVED AVAILABLESALES CHARGE WAIVERS. THE FIRM ESTIMATED THAT APPROXIMATELY541 CUSTOMER ACCOUNTS PURCHASED MUTUAL FUND SHARES FORWHICH AN AVAILABLE SALES CHARGE WAIVER WAS NOT APPLIED. AS ARESULT OF THE FAILURE OF THE FIRM TO APPLY AVAILABLE SALESCHARGE WAIVERS, IT ESTIMATED THAT ELIGIBLE CUSTOMERS WEREOVERCHARGED BY AT LEAST $553,398 FOR MUTUAL FUND PURCHASESMADE.







WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT ITDISADVANTAGED CERTAIN RETIREMENT PLAN AND CHARITABLEORGANIZATION CUSTOMERS THAT WERE ELIGIBLE TO PURCHASE CLASSA SHARES IN CERTAIN MUTUAL FUNDS WITHOUT A FRONT-END SALESCHARGE (ELIGIBLE CUSTOMERS). THE FINDINGS STATED THAT MANYMUTUAL FUNDS WAIVE THE UP-FRONT SALES CHARGES ASSOCIATEDWITH CLASS A SHARES FOR CERTAIN RETIREMENT PLANS AND/ORCHARITABLE ORGANIZATIONS. SOME OF THE MUTUAL FUNDS AVAILABLEON THE FIRM'S RETAIL PLATFORM OFFERED SUCH WAIVERS ANDDISCLOSED THOSE WAIVERS IN THEIR PROSPECTUSES.NOTWITHSTANDING THE AVAILABILITY OF THE WAIVERS, THE FIRM FAILEDTO APPLY THE WAIVERS TO MUTUAL FUND PURCHASES MADE BYELIGIBLE CUSTOMERS AND INSTEAD SOLD THE CUSTOMERS CLASS ASHARES WITH A FRONT-END SALES CHARGE OR CLASS B OR C SHARESWITH BACK-END SALES CHARGES AND HIGHER ONGOING FEES ANDEXPENSES. THESE SALES DISADVANTAGED ELIGIBLE CUSTOMERS BYCAUSING SUCH CUSTOMERS TO PAY HIGHER FEES THAN THEY WEREACTUALLY REQUIRED TO PAY. THE DIFFERENT SALES CHARGES,BREAKPOINTS, WAIVERS AND FEES ASSOCIATED WITH DIFFERENT SHARECLASSES AFFECT MUTUAL FUND INVESTORS' RETURNS. IF AN INVESTORQUALIFIES FOR A CLASS A SALES CHARGE WAIVER AND PURCHASEDCLASS A SHARES, THE INVESTOR WILL NOT PAY A FRONT-END SALESLOAD. IN CONTRAST, A PURCHASE OF CLASS B OR C SHARES OF THESAME FUND WILL BE SUBJECT TO HIGHER ONGOING FEES, AS WELL AS APOTENTIAL APPLICATION OF A CONTINGENT DEFERRED SALES CHARGE.THEREFORE, IF AN INVESTOR QUALIFIES FOR A CLASS A SALES CHARGEWAIVER, THERE WOULD BE NO REASON FOR THE INVESTOR TOPURCHASE ANY OTHER CLASS OF SHARES THAT HAS A SALES LOADAND/OR HIGHER ANNUAL EXPENSES. THE FINDINGS ALSO STATED THATTHE FIRM FAILED TO REASONABLY SUPERVISE MUTUAL FUND SALES TOENSURE THAT ELIGIBLE CUSTOMERS WHO PURCHASED MUTUAL FUNDSHARES RECEIVED THE BENEFIT OF APPLICABLE SALES CHARGEWAIVERS. THE FIRM RELIED ON ITS FINANCIAL ADVISORS TO DETERMINETHE APPLICABILITY OF SALES CHARGE WAIVERS BUT FAILED TO MAINTAINADEQUATE WRITTEN POLICIES OR PROCEDURES TO ASSIST FINANCIALADVISORS IN MAKING THIS DETERMINATION. FOR INSTANCE, THE FIRMFAILED TO ESTABLISH AND MAINTAIN WRITTEN PROCEDURES TOIDENTIFY APPLICABLE SALES CHARGE WAIVERS IN FUND'SPROSPECTUSES FOR ELIGIBLE CUSTOMERS. IN ADDITION, THE FIRMFAILED TO ADEQUATELY NOTIFY AND TRAIN ITS FINANCIAL ADVISORSREGARDING THE AVAILABILITY OF MUTUAL FUND SALES CHARGEWAIVERS FOR ELIGIBLE CUSTOMERS. FINALLY, THE FIRM FAILED TOADOPT ADEQUATE CONTROLS TO DETECT INSTANCES IN WHICH THEY DIDNOT PROVIDE SALES CHARGE WAIVERS TO ELIGIBLE CUSTOMERS INCONNECTION WITH THEIR MUTUAL FUND PURCHASES. THE FINDINGSALSO INCLUDED THAT THE FIRM BEGAN A REVIEW TO DETERMINEWHETHER IT PROVIDED AVAILABLE SALES CHARGE WAIVERS TO ELIGIBLECUSTOMERS. BASED ON THIS REVIEW, THE FIRM SELF-REPORTED TOFINRA THAT ELIGIBLE CUSTOMERS MAY NOT HAVE RECEIVED AVAILABLESALES CHARGE WAIVERS. THE FIRM ESTIMATED THAT APPROXIMATELY541 CUSTOMER ACCOUNTS PURCHASED MUTUAL FUND SHARES FORWHICH AN AVAILABLE SALES CHARGE WAIVER WAS NOT APPLIED. AS ARESULT OF THE FAILURE OF THE FIRM TO APPLY AVAILABLE SALESCHARGE WAIVERS, IT ESTIMATED THAT ELIGIBLE CUSTOMERS WEREOVERCHARGED BY AT LEAST $553,398 FOR MUTUAL FUND PURCHASESMADE.






Initiated By: FINRA




Docket/Case Number: 2016050259001

Principal Product Type: Mutual Fund(s)




Resolution:

Other Sanctions Ordered: UNDERTAKING

Sanction Details: THE FIRM WAS CENSURED, REQUIRED TO PAY A TOTAL OF AT LEAST$628,040, INCLUSIVE OF INTEREST, IN RESTITUTION TO ELIGIBLECUSTOMERS, AND WILL ALSO ENSURE THAT RETIREMENT ANDCHARITABLE WAIVERS ARE APPROPRIATELY APPLIED TO ALL FUTURETRANSACTIONS, AND REQUIRED TO PROVIDE REMEDIATION TO ELIGIBLECUSTOMERS WHO, FROM JULY 1, 2009, QUALIFIED FOR, BUT DID NOTRECEIVE, THE APPLICABLE MUTUAL FUND SALES CHARGE WAIVERSWHEN THE FIRM FAILED TO IDENTIFY AND APPLY AVAILABLE SALESCHARGE WAIVERS TO ELIGIBLE RETIREMENT ACCOUNTS ANDCHARITABLE ORGANIZATIONS. THE FIRM WILL PROVIDE TO FINRA ADETAILED PLAN TO REMEDIATE ELIGIBLE CUSTOMERS BASED ONSPECIFIC CRITERIA THAT ARE NOT UNACCEPTABLE TO FINRA. THE FIRMWILL ALSO ADDRESS RESTITUTION FOR EACH RETIREMENT PLANCUSTOMER THAT, WHILE NOT ELIGIBLE TO PURCHASE CLASS A SHARESWITHOUT A FRONT-END SALES CHARGE, WAS ELIGIBLE TO PURCHASE ANALTERNATIVE SHARE CLASS (INCLUDING, BUT NOT LIMITED TO, RSHARES) WITHOUT A FRONT-END SALES CHARGE AND WITH ONGOINGFEES SUBSTANTIALLY SIMILAR TO THOSE OF THE CLASS A SHARE. THEFIRM WILL SUBMIT TO FINRA A SCHEDULE OF ELIGIBLE CUSTOMERSIDENTIFIED FOR REMEDIATION AND INCLUDE THE DETAILS OF THEQUALIFYING PURCHASES AND TOTAL DOLLAR AMOUNTS OF RESTITUTIONTHAT WILL BE PROVIDED TO EACH CUSTOMER.


No

Sanctions Ordered: CensureDisgorgement/Restitution

Acceptance, Waiver & Consent(AWC)





https://www.finra.org/rules-guidance/oversight-enforcement/finra-disciplinary-actions?search=2016050259001


THE FIRM WAS CENSURED, REQUIRED TO PAY A TOTAL OF AT LEAST$628,040, INCLUSIVE OF INTEREST, IN RESTITUTION TO ELIGIBLECUSTOMERS, AND WILL ALSO ENSURE THAT RETIREMENT ANDCHARITABLE WAIVERS ARE APPROPRIATELY APPLIED TO ALL FUTURETRANSACTIONS, AND REQUIRED TO PROVIDE REMEDIATION TO ELIGIBLECUSTOMERS WHO, FROM JULY 1, 2009, QUALIFIED FOR, BUT DID NOTRECEIVE, THE APPLICABLE MUTUAL FUND SALES CHARGE WAIVERSWHEN THE FIRM FAILED TO IDENTIFY AND APPLY AVAILABLE SALESCHARGE WAIVERS TO ELIGIBLE RETIREMENT ACCOUNTS ANDCHARITABLE ORGANIZATIONS. THE FIRM WILL PROVIDE TO FINRA ADETAILED PLAN TO REMEDIATE ELIGIBLE CUSTOMERS BASED ONSPECIFIC CRITERIA THAT ARE NOT UNACCEPTABLE TO FINRA. THE FIRMWILL ALSO ADDRESS RESTITUTION FOR EACH RETIREMENT PLANCUSTOMER THAT, WHILE NOT ELIGIBLE TO PURCHASE CLASS A SHARESWITHOUT A FRONT-END SALES CHARGE, WAS ELIGIBLE TO PURCHASE ANALTERNATIVE SHARE CLASS (INCLUDING, BUT NOT LIMITED TO, RSHARES) WITHOUT A FRONT-END SALES CHARGE AND WITH ONGOINGFEES SUBSTANTIALLY SIMILAR TO THOSE OF THE CLASS A SHARE. THEFIRM WILL SUBMIT TO FINRA A SCHEDULE OF ELIGIBLE CUSTOMERSIDENTIFIED FOR REMEDIATION AND INCLUDE THE DETAILS OF THEQUALIFYING PURCHASES AND TOTAL DOLLAR AMOUNTS OF RESTITUTIONTHAT WILL BE PROVIDED TO EACH CUSTOMER.


Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT ITDISADVANTAGED CERTAIN RETIREMENT PLAN AND CHARITABLEORGANIZATION CUSTOMERS THAT WERE ELIGIBLE TO PURCHASE CLASSA SHARES IN CERTAIN MUTUAL FUNDS WITHOUT A FRONT-END SALESCHARGE (ELIGIBLE CUSTOMERS). THE FINDINGS STATED THAT MANYMUTUAL FUNDS WAIVE THE UP-FRONT SALES CHARGES ASSOCIATEDWITH CLASS A SHARES FOR CERTAIN RETIREMENT PLANS AND/ORCHARITABLE ORGANIZATIONS. SOME OF THE MUTUAL FUNDS AVAILABLEON THE FIRM'S RETAIL PLATFORM OFFERED SUCH WAIVERS ANDDISCLOSED THOSE WAIVERS IN THEIR PROSPECTUSES.NOTWITHSTANDING THE AVAILABILITY OF THE WAIVERS, THE FIRM FAILEDTO APPLY THE WAIVERS TO MUTUAL FUND PURCHASES MADE BYELIGIBLE CUSTOMERS AND INSTEAD SOLD THE CUSTOMERS CLASS ASHARES WITH A FRONT-END SALES CHARGE OR CLASS B OR C SHARESWITH BACK-END SALES CHARGES AND HIGHER ONGOING FEES ANDEXPENSES. THESE SALES DISADVANTAGED ELIGIBLE CUSTOMERS BYCAUSING SUCH CUSTOMERS TO PAY HIGHER FEES THAN THEY WEREACTUALLY REQUIRED TO PAY. THE DIFFERENT SALES CHARGES,BREAKPOINTS, WAIVERS AND FEES ASSOCIATED WITH DIFFERENT SHARECLASSES AFFECT MUTUAL FUND INVESTORS' RETURNS. IF AN INVESTORQUALIFIES FOR A CLASS A SALES CHARGE WAIVER AND PURCHASEDCLASS A SHARES, THE INVESTOR WILL NOT PAY A FRONT-END SALESLOAD. IN CONTRAST, A PURCHASE OF CLASS B OR C SHARES OF THESAME FUND WILL BE SUBJECT TO HIGHER ONGOING FEES, AS WELL AS APOTENTIAL APPLICATION OF A CONTINGENT DEFERRED SALES CHARGE.THEREFORE, IF AN INVESTOR QUALIFIES FOR A CLASS A SALES CHARGEWAIVER, THERE WOULD BE NO REASON FOR THE INVESTOR TOPURCHASE ANY OTHER CLASS OF SHARES THAT HAS A SALES LOADAND/OR HIGHER ANNUAL EXPENSES. THE FINDINGS ALSO STATED THATTHE FIRM FAILED TO REASONABLY SUPERVISE MUTUAL FUND SALES TOENSURE THAT ELIGIBLE CUSTOMERS WHO PURCHASED MUTUAL FUNDSHARES RECEIVED THE BENEFIT OF APPLICABLE SALES CHARGEWAIVERS. THE FIRM RELIED ON ITS FINANCIAL ADVISORS TO DETERMINETHE APPLICABILITY OF SALES CHARGE WAIVERS BUT FAILED TO MAINTAINADEQUATE WRITTEN POLICIES OR PROCEDURES TO ASSIST FINANCIALADVISORS IN MAKING THIS DETERMINATION. FOR INSTANCE, THE FIRMFAILED TO ESTABLISH AND MAINTAIN WRITTEN PROCEDURES TOIDENTIFY APPLICABLE SALES CHARGE WAIVERS IN FUND'SPROSPECTUSES FOR ELIGIBLE CUSTOMERS. IN ADDITION, THE FIRMFAILED TO ADEQUATELY NOTIFY AND TRAIN ITS FINANCIAL ADVISORSREGARDING THE AVAILABILITY OF MUTUAL FUND SALES CHARGEWAIVERS FOR ELIGIBLE CUSTOMERS. FINALLY, THE FIRM FAILED TOADOPT ADEQUATE CONTROLS TO DETECT INSTANCES IN WHICH THEY DIDNOT PROVIDE SALES CHARGE WAIVERS TO ELIGIBLE CUSTOMERS INCONNECTION WITH THEIR MUTUAL FUND PURCHASES. THE FINDINGSALSO INCLUDED THAT THE FIRM BEGAN A REVIEW TO DETERMINEWHETHER IT PROVIDED AVAILABLE SALES CHARGE WAIVERS TO ELIGIBLECUSTOMERS. BASED ON THIS REVIEW, THE FIRM SELF-REPORTED TOFINRA THAT ELIGIBLE CUSTOMERS MAY NOT HAVE RECEIVED AVAILABLESALES CHARGE WAIVERS. THE FIRM ESTIMATED THAT APPROXIMATELY541 CUSTOMER ACCOUNTS PURCHASED MUTUAL FUND SHARES FORWHICH AN AVAILABLE SALES CHARGE WAIVER WAS NOT APPLIED. AS ARESULT OF THE FAILURE OF THE FIRM TO APPLY AVAILABLE SALESCHARGE WAIVERS, IT ESTIMATED THAT ELIGIBLE CUSTOMERS WEREOVERCHARGED BY AT LEAST $553,398 FOR MUTUAL FUND PURCHASESMADE.







Initiated By: FINRA





Principal Product Type: Money Market Fund(s)




Resolution:



Sanctions Ordered: CensureDisgorgement/Restitution









Disclosure 3 of 11

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Initiated By: FINRA

Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOIDENTIFY AND APPLY SALES CHARGE DISCOUNTS TO CERTAINCUSTOMERS' ELIGIBLE PURCHASES OF UNIT INVESTMENT TRUSTS (UITS)RESULTING IN CUSTOMERS PAYING EXCESSIVE SALES CHARGES OFAPPROXIMATELY $452,622. THE FINDINGS STATED THAT THE FIRM HASPAID RESTITUTION TO ALL AFFECTED CUSTOMERS. THE FINDINGS ALSOSTATED THAT THE FIRM FAILED TO ESTABLISH, MAINTAIN AND ENFORCE ASUPERVISORY SYSTEM AND WRITTEN SUPERVISORY PROCEDURES(WSPS) REASONABLY DESIGNED TO ENSURE THAT CUSTOMERSRECEIVED SALES CHARGE DISCOUNTS ON ALL ELIGIBLE UIT PURCHASES.THE FIRM RELIED PRIMARILY ON ITS REGISTERED REPRESENTATIVES TOENSURE THAT CUSTOMERS RECEIVED APPROPRIATE UIT SALES CHARGEDISCOUNTS, DESPITE THE FACT THAT THE FIRM DID NOT EFFECTIVELYINFORM AND TRAIN REPRESENTATIVES AND THEIR SUPERVISORS TOIDENTIFY AND APPLY SALES CHARGE DISCOUNTS.







Initiated By: FINRA


Other


N/A



Principal Product Type: Unit Investment Trust(s)



Resolution:


Sanction Details: THE FIRM WAS CENSURED, FINED $250,000, AND PAID RESTITUTION OF$452,622 TO CUSTOMERS.

FINE PAID IN FULL ON NOVEMBER 10, 2015.


No

Sanctions Ordered: CensureMonetary/Fine $250,000.00Disgorgement/Restitution



Allegations: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOIDENTIFY AND APPLY SALES CHARGE DISCOUNTS TO CERTAINCUSTOMERS' ELIGIBLE PURCHASES OF UNIT INVESTMENT TRUSTS (UITS)RESULTING IN CUSTOMERS PAYING EXCESSIVE SALES CHARGES OFAPPROXIMATELY $452,622. THE FINDINGS STATED THAT THE FIRM HASPAID RESTITUTION TO ALL AFFECTED CUSTOMERS. THE FINDINGS ALSOSTATED THAT THE FIRM FAILED TO ESTABLISH, MAINTAIN AND ENFORCE ASUPERVISORY SYSTEM AND WRITTEN SUPERVISORY PROCEDURES(WSPS) REASONABLY DESIGNED TO ENSURE THAT CUSTOMERSRECEIVED SALES CHARGE DISCOUNTS ON ALL ELIGIBLE UIT PURCHASES.THE FIRM RELIED PRIMARILY ON ITS REGISTERED REPRESENTATIVES TOENSURE THAT CUSTOMERS RECEIVED APPROPRIATE UIT SALES CHARGEDISCOUNTS, DESPITE THE FACT THAT THE FIRM DID NOT EFFECTIVELYINFORM AND TRAIN REPRESENTATIVES AND THEIR SUPERVISORS TOIDENTIFY AND APPLY SALES CHARGE DISCOUNTS.








Initiated By: FINRA


Other


N/A



Principal Product Type: Unit Investment Trust(s)


WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE SANCTIONS AND TO THE ENTRY OF FINDINGS THAT IT FAILED TOIDENTIFY AND APPLY SALES CHARGE DISCOUNTS TO CERTAINCUSTOMERS' ELIGIBLE PURCHASES OF UNIT INVESTMENT TRUSTS (UITS)RESULTING IN CUSTOMERS PAYING EXCESSIVE SALES CHARGES OFAPPROXIMATELY $452,622. THE FINDINGS STATED THAT THE FIRM HASPAID RESTITUTION TO ALL AFFECTED CUSTOMERS. THE FINDINGS ALSOSTATED THAT THE FIRM FAILED TO ESTABLISH, MAINTAIN AND ENFORCE ASUPERVISORY SYSTEM AND WRITTEN SUPERVISORY PROCEDURES(WSPS) REASONABLY DESIGNED TO ENSURE THAT CUSTOMERSRECEIVED SALES CHARGE DISCOUNTS ON ALL ELIGIBLE UIT PURCHASES.THE FIRM RELIED PRIMARILY ON ITS REGISTERED REPRESENTATIVES TOENSURE THAT CUSTOMERS RECEIVED APPROPRIATE UIT SALES CHARGEDISCOUNTS, DESPITE THE FACT THAT THE FIRM DID NOT EFFECTIVELYINFORM AND TRAIN REPRESENTATIVES AND THEIR SUPERVISORS TOIDENTIFY AND APPLY SALES CHARGE DISCOUNTS.


Resolution:


Sanction Details: THE FIRM WAS CENSURED, FINED $250,000, AND PAID RESTITUTION OF$452,622 TO CUSTOMERS.

Sanctions Ordered: CensureMonetary/Fine $250,000.00Disgorgement/Restitution


Disclosure 4 of 11

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Allegations: NASD RULE 2110: THE BREAKPOINT SELF-ASSESSMENT FOLLOW-UPREVIEW CONDUCTED FOR THE FIRM FOUND THAT THE FIRM FAILED TOACCURATELY COMPLETE THE SELF-ASSESSMENT OF BREAKPOINTCOMPLIANCE AND THE FIRM'S SELF-ASSESSMENT UNDERREPORTED THENUMBER OF TRANSACTIONS WITH MISSED BREAKPOINTS. HAD THE FIRMACCURATELY COMPLETED ITS SELF-ASSESSMENT, FINRA WOULD HAVEDIRECTED THE FIRM TO UNDERTAKE ADDITIONAL REMEDIAL STEPS. THEFIRM DID NOT ACCURATELY COMPLETE THE REQUIRED TRADE-BY-TRADEREVIEWS OF ITS TRANSACTIONS AND THE TRANSACTIONS OF A FIRM ITHAD ACQUIRED AS PART OF THE REMEDIATION PROCESS FOLLOWINGTHE SELF-ASSESSMENT.








Initiated By: FINRA





Principal Product Type: No Product


NASD RULE 2110: THE BREAKPOINT SELF-ASSESSMENT FOLLOW-UPREVIEW CONDUCTED FOR THE FIRM FOUND THAT THE FIRM FAILED TOACCURATELY COMPLETE THE SELF-ASSESSMENT OF BREAKPOINTCOMPLIANCE AND THE FIRM'S SELF-ASSESSMENT UNDERREPORTED THENUMBER OF TRANSACTIONS WITH MISSED BREAKPOINTS. HAD THE FIRMACCURATELY COMPLETED ITS SELF-ASSESSMENT, FINRA WOULD HAVEDIRECTED THE FIRM TO UNDERTAKE ADDITIONAL REMEDIAL STEPS. THEFIRM DID NOT ACCURATELY COMPLETE THE REQUIRED TRADE-BY-TRADEREVIEWS OF ITS TRANSACTIONS AND THE TRANSACTIONS OF A FIRM ITHAD ACQUIRED AS PART OF THE REMEDIATION PROCESS FOLLOWINGTHE SELF-ASSESSMENT.


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS:THEREFORE, THE FIRM IS CENSURED AND FINED $150,000.


No

Sanctions Ordered: CensureMonetary/Fine $150,000.00



Allegations: FINRA ALLEGED THAT THE FIRM FAILED TO ACCURATELY COMPLETE ITS2003 BREAKPOINT SELF-ASSESSMENT IN THAT IT UNDERREPORTED THENUMBER OF MISSED BREAKPOINTS IN VIOLATION OF NASD CONDUCTRULE 2110. FINRA ALSO ALLEGED THAT IN 2003 THE FIRM FAILED TOACCURATELY COMPLETE A TRADE-BY-TRADE REVIEW OF TRANSACTIONSFOR MISSED BREAKPOINTS FOR THE FIRM AND VESTAX, A BROKER-DEALER ACQUIRED BY THE FIRM IN 2004. THE FIRM HAS NEITHERADMITTED NOR DENIED THESE ALLEGATIONS.


Appealed To and Date AppealFiled:

N/A







Initiated By: FINANCIAL INDUSTRY REGULATORY AUTHORITY


Censure


A FINE IN THE AMOUNT OF $150,000.


Docket/Case Number: NO. 2005001166601



FINRA ALLEGED THAT THE FIRM FAILED TO ACCURATELY COMPLETE ITS2003 BREAKPOINT SELF-ASSESSMENT IN THAT IT UNDERREPORTED THENUMBER OF MISSED BREAKPOINTS IN VIOLATION OF NASD CONDUCTRULE 2110. FINRA ALSO ALLEGED THAT IN 2003 THE FIRM FAILED TOACCURATELY COMPLETE A TRADE-BY-TRADE REVIEW OF TRANSACTIONSFOR MISSED BREAKPOINTS FOR THE FIRM AND VESTAX, A BROKER-DEALER ACQUIRED BY THE FIRM IN 2004. THE FIRM HAS NEITHERADMITTED NOR DENIED THESE ALLEGATIONS.


Resolution:


Sanction Details: FINRA ALLEGED THAT THE FIRM FAILED TO ACCURATELY COMPLETE ITS2003 BREAKPOINT SELF-ASSESSMENT IN THAT IT UNDERREPORTED THENUMBER OF MISSED BREAKPOINTS IN VIOLATION OF NASD CONDUCTRULE 2110. FINRA ALSO ALLEGED THAT IN 2003 THE FIRM FAILED TOACCURATELY COMPLETE A TRADE-BY-TRADE REVIEW OF TRANSACTIONSFOR MISSED BREAKPOINTS FOR THE FIRM AND VESTAX, A BROKER-DEALER ACQUIRED BY THE FIRM IN 2004. THE FIRM HAS NEITHERADMITTED NOR DENIED THESE ALLEGATIONS.



Disclosure 5 of 11

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Reporting Source: Firm

Initiated By: STATE OF NEW YORK INSURANCE DEPARTMENT

Allegations: NEW YORK ALLEGED THAT THE FIRM FAILED TO TIMELY PROVIDEINFORMATION REGARDING SECURITIES ADMINISTRATIVE ACTIONS ASREQUIRED ON ITS INSURANCE LICENSE RENEWAL APPLICATIONS DATEDJUNE 16, 2006 AND MAY 2, 2007.







Initiated By: STATE OF NEW YORK INSURANCE DEPARTMENT


Civil and Administrative Penalt(ies) /Fine(s)



Docket/Case Number: 2008-0227-S




Resolution:


Sanction Details: PENALTY OF $10,000 WAS IMPOSED AGAINST THE FIRM, WHICH WAS PAIDON 01/22/2009.

Firm Statement THE FIRM EXECUTED A STIPULATION REQUIRING THAT IT PAY A $10,000PENALTY AND TAKE ALL NECESSARY STEPS TO PREVENT THEREOCCURANCE OF SIMILAR VIOLATIONS.

Sanctions Ordered: Monetary/Fine $10,000.00

Stipulation and Consent

Disclosure 6 of 11

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Initiated By: FINRA




Principal Product Type: Other

Other Product Type(s): PROMISSORY NOTES

Allegations: NASD RULES 2110, 3010 - MULTI-FINANCIAL SECURITIES CORPORATIONFAILED TO DETECT AN INDIVIDUAL'S ONGOING PRIVATE SECURITIESTRANSACTIONS; TO EITHER DISAPPROVE OR APPROVE THETRANSACTIONS; TO SUPERVISE ANY APPROVED TRANSACTIONS AND TORECORD THEM ON ITS BOOKS AND RECORDS.










Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED AND FINED $12,000.


No






Censure


FINE OF $12,000.00




Other Product Type(s): THE REGISTERED REPRESENTATIVE SOLD PROMISSORY NOTES ON ANUNAPPROVED BASIS.

Allegations: FINRA RULE 3010 AND 2110. WITHOUT ADMITTING OR DENYING THEALLEGATIONS, THE FIRM CONSENTED TO FINDINGS THAT IT FAILED TOHAVE ADEQUATE SUPERVISORY SYSTEMS AND PROCEDURES TO DETECTUNAPPROVED PRIVATE SECURITIES TRANSACTIONS BY A FORMERREGISTERED REPRESENTATIVE WHO RAISED APPROXIMATELY $1,154,000FROM 14 INDIVIDUALS IN EXCHANGE FOR PROMISSORY NOTES.


Resolution: Acceptance, Waiver & Consent(AWC) 37©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC







Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF THE FINDINGS;THEREFORE THE FIRM IS CENSURED AND FINED $12,000.00.



Disclosure 7 of 11

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Initiated By: FINRA






Other Product Type(s): TRACE-ELIGIBLE SECURITIES

Allegations: NASD RULES 2110, 3010, 6230(A), 6230(C)(8) - MULTI-FINANCIALSECURITIES CORPORATION FAILED TO REPORT TO TRACETRANSACTIONS IN TRACE-ELIGIBLE SECURITIES EXECUTED ON ABUSINESS DAY DURING TRACE SYSTEM HOURS WITHIN 45 MINUTES OFTHE TIME OF EXECUTION; FAILED TO REPORT TO TRACE TRANSACTIONSIN TRACE-ELIGIBLE SECURITIES EXECUTED ON A BUSINESS DAY DURINGTRACE SYSTEM HOURS WITHIN 30 MINUTES OF THE TIME OF EXECUTION;FAILED TO REPORT TO TRACE THE CORRECT TIME OF TRADE EXECUTIONFOR TRANSACTIONS IN TRACE-ELIGIBLE SECURITIES. THE FIRM'SSUPERVISORY SYSTEM DID NOT PROVIDE FOR SUERVISION REASONABLYDESIGNED TO ACHIEVE COMPLIANCE WITH RESPECT TO APPLICABLESECURITIES LAWS, REGULATIONS AND NASD RULES CONCERNING TRACEREPORTING.



Resolution: Acceptance, Waiver & Consent(AWC)









Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE THE FIRM IS CENSURED, FINED $10,000 AND REQUIRED TOREVISE ITS WRITTEN SUPERVISORY PROCEDURES WITH RESPECT TOTRACE REPORTING WITHIN 30 BUSINESS DAYS OF ACCEPTANCE OF THISAWC BY THE NAC.


No





Censure



Docket/Case Number: 20070085804-01


Other Product Type(s): TRACE-ELIGIBLE SECURITIES

Allegations: FINRA RULES 2110, 3010, 6230(A) - MULTI-FINANCIAL SECURITIESCORPORATION FAILED TO REPORT TO TRACE TRANSACTIONS IN TRACE-ELIGIBLE SECURITIES EXECUTED ON A BUSINESS DAY DURING TRACESYSTEM HOURS WITHIN THE REQUIRED PERIOD OF TIME FOLLOWING THETIME OF EXECUTION; THE FIRM FAILED TO REPORT THE CORRECT TIMEOF TRADE EXECUTION IN TRACE-ELIGIBLE SECURITIES; AND THE FIRM'SSUPERVISORY SYSTEM DID NOT PROVIDE FOR SUPERVISIONREASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITH RESPECT TOAPPLICABLE SECURITIES LAWS, REGULATIONS AND FINRA RULESCONCERNING REPORTING OF TRANSACTIONS IN TRACE-ELIGIBLESECURITIES.









Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, THE FIRM IS CENSURED, FINED $10,000.00 AND REQUIREDTO REVISE ITS WRITTEN SUPERVISORY PROCEDURES WITH RESPECT TOREPORTING OF TRANSACTIONS IN TRACE-ELIGIBLE SECURITIES WITHIN30 BUSINESS DAYS OF ACCEPTANCE OF THIS AWC BY THE NAC.



Disclosure 8 of 11

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Initiated By: NASD



Docket/Case Number: EAF0400760002



Allegations: NASD RULES 2110 AND 2830(K)(1) - RESPONDENT MAINTAINED A SHELFSPACE (REVENUE SHARING) PROGRAM KNOWN AS THE STRATEGICPARTNERS PLATFORM IN CONNECTION WITH RETAIL SALES OF MUTUALFUNDS. IN RETURN FOR PAYMENTS, MUTUAL FUND COMPLEXES THATPARTICIPATED IN THE PROGRAM RECEIVED PREFERENTIAL TREATMENTFROM THE FIRM IN THE SALES AND MARKETING OF THEIR FUNDS. THEPROGRAM PROVIDED INCREASED ACCESS TO THE FIRM'S RETAILBROKERAGE SALES FORCE, PLACEMENT OF MATERIALS ON THE FIRM'SWEBSITES, IDENTIFICATION AS A STRATEGIC PARTNER ON THE ITSINTRANET WEBSITES INCLUDING LINKS TO THE STRATEGIC PARTNERS'WEBSITES AND PAYMENT OF TICKET CHARGES FOR RETAIL BROKERAGESALES OF STRATEGIC PARTNERS' FUNDS. SOME MUTUAL FUNDCOMPLEXES MADE PAYMENTS FOR PARTICIPATING IN THE PROGRAM BYDIRECTING APPROXIMATELY $4.7 MILLION IN MUTUAL FUND PORTFOLIOBROKERAGE COMMISSIONS TO THE FIRM THOUGH CLEARING BROKERS.






https://www.finra.org/rules-guidance/oversight-enforcement/finra-disciplinary-actions?search=EAF0400760002





Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MULTI-FINANCIALSECURITIES CORPORATION CONSENTED TO THE DESCRIBED SANCTIONSAND TO THE ENTRY OF FINDINGS; THEREFORE THE FIRM IS CENSUREDAND FINED $1,228,000.


No

Sanctions Ordered: CensureMonetary/Fine $1,228,000.00



Initiated By: NASD




Docket/Case Number: EAF0400760002



Allegations: MULTI-FINANCIAL AND ITS CONTROL AFFILIATES, FINANCIAL NETWORKSECURITIES CORPORATION, ING FINANCIAL PARTNERS, FINANCIALNETWORK INVESTMENT CORPORATION AND PRIMEVEST FINANCIALSECURITIES, INC. ("THE FIRMS") SIGNED AN AWC IN WHICH THE NASDFOUND THAT THE FIRMS MAINTAINED A STRATEGIC PARTNERS PROGRAM("THE PROGRAM") WHEREBY THE FIRMS RECEIVED DIRECTEDBROKERAGE COMMISSIONS FROM MUTUAL FUNDS TO PAY FORPARTICIPATION IN THE PROGRAM, WHICH VIOLATED NASD RULES2830(K)(1) AND 2110.






https://www.finra.org/rules-guidance/oversight-enforcement/finra-disciplinary-actions?search=EAF0400760002





CENSURE


Resolution:


Sanction Details: TOTAL FINE - $7,000,000.00MULTI-FINANCIAL SECURITIES CORPORATION - $1,228,000.00FINANCIAL NETWORK SECURITIES CORPORATION - $3,415,000.00ING FINANCIAL PARTNERS - $1,291,000.00PRIMEVEST FINANCIAL SECURITIES, INC. $1,066,000.00

Firm Statement MULTI-FINANCIAL AND ITS CONTROL AFFILIATES, FINANCIAL NETWORKSECURITIES CORPORATION, ING FINANCIAL PARTNERS, FINANCIALNETWORK INVESTMENT CORPORATION AND PRIMEVEST FINANCIALSECURITIES, INC. ("THE FIRMS") SIGNED AN AWC ON 07/27/2006. THEFIRMS WERE FINED A TOTAL OF $7,000.000.00 AND CENSURED. MULTI-FINANCIAL SECURITIES CORPORATION IS RESPONSIBLE FOR A FINE INTHE AMOUNT OF $1,228,000.00.

Sanctions Ordered: CensureMonetary/Fine $1,228,000.00


Disclosure 9 of 11

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Initiated By: NASD


Docket/Case Number: E3A2005000101

Allegations: NASD RULES 2110, 3010, 3011, MSRB RULE G-41 - RESPONDENT FAILED TOIMPLEMENT A WRITTEN ANTI-MONEY LAUNDERING PROGRAMREASONABLY DESIGNED TO ACHIEVE AND MONITOR COMPLIANCE WITHTHE REQUIREMENTS OF THE BANK SECRECY ACT AND THE REGULATIONSPROMULGATED THEREUNDER. THE FINDINGS STATED THAT THE FIRM,FAILED TO ESTABLISH AND MAINTAIN A SUPERVISORY SYSTEM ORWRITTEN SUPERVISORY PROCEDURES THAT WERE REASONABLYDESIGNED TO ENABLE THE FIRM TO PREVENT AND DETECT THECHARGING OF EXCESSIVE COMMISSIONS ON MUTUAL FUNDLIQUIDATIONS.






https://www.finra.org/rules-guidance/oversight-enforcement/finra-disciplinary-actions?search=E3A2005000101








Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, MULTI-FINANCIALSECURITIES CORPORATION, CONSENTED TO THE DESCRIBED SANCTIONSAND TO THE ENTRY OF FINDINGS, THEREFORE, THE FIRM IS CENSUREDAND FINED $17,500.


No




Allegations: DURING A ROUTINE B/D EXAMINATION, THE NASD DETERMINED THAT FORTHE PERIOD JANUARY 2004 THROUGH NOVEMBER 2004, THE FIRM FAILEDTO ESTABLISH A SUPERVISORY SYSTEM OR WRITTEN SUPERVISORYPROCEDURES REASONABLY DESIGNED TO ENABLE THE FIRM TOPREVENT THE CHARGING OF EXCESSIVE COMMISSIONS ON MUTUALFUND LIQUIDATIONS IN VIOLATION OF NASD CR 2110 AND 3010. THE NASDFURTHER DETERMINED THAT IN VIOLATION OF NASD CR 2110 AND 3011AND MSRB RULE G-41, THE FIRM FAILED TO IMPLEMENT THE FIRM'S ANTI-MONEY LAUNDERING PROCEDURES I) RELATING TO THE PROCESSING OFFINCEN REQUESTS FOR INFORMATION FROM FEBRUARY 18, 2003 TOJANUARY 2004 AND FOR THE MONTH OF MAY 2004; AND II) RELATING TOCHECKING THE OFAC LIST IN RELATION TO NEW ACCOUNTS FOR THEPERIOD JULY 2003 THROUGH MAY 2004. THE FIRM HAS NEITHERADMITTED NOR DENIED THESE ALLEGATIONS.








Initiated By: NATIONAL ASSOCIATION OF SECURITIES DEALERS (NASD)


Censure


A FINE IN THE AMOUNT OF $17,500.





DURING A ROUTINE B/D EXAMINATION, THE NASD DETERMINED THAT FORTHE PERIOD JANUARY 2004 THROUGH NOVEMBER 2004, THE FIRM FAILEDTO ESTABLISH A SUPERVISORY SYSTEM OR WRITTEN SUPERVISORYPROCEDURES REASONABLY DESIGNED TO ENABLE THE FIRM TOPREVENT THE CHARGING OF EXCESSIVE COMMISSIONS ON MUTUALFUND LIQUIDATIONS IN VIOLATION OF NASD CR 2110 AND 3010. THE NASDFURTHER DETERMINED THAT IN VIOLATION OF NASD CR 2110 AND 3011AND MSRB RULE G-41, THE FIRM FAILED TO IMPLEMENT THE FIRM'S ANTI-MONEY LAUNDERING PROCEDURES I) RELATING TO THE PROCESSING OFFINCEN REQUESTS FOR INFORMATION FROM FEBRUARY 18, 2003 TOJANUARY 2004 AND FOR THE MONTH OF MAY 2004; AND II) RELATING TOCHECKING THE OFAC LIST IN RELATION TO NEW ACCOUNTS FOR THEPERIOD JULY 2003 THROUGH MAY 2004. THE FIRM HAS NEITHERADMITTED NOR DENIED THESE ALLEGATIONS.


Resolution:


Sanction Details: A FINE IN THE AMOUNT OF $17,500.00



Disclosure 10 of 11

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Reporting Source: Firm

Initiated By: STATE OF IDAHO, DEPARTMENT OF FINANCE, SECURITIES BUREAU


Docket/Case Number: DOCKET NO. 2002-7-17


Allegations: RESPONDENT BATTEN ALLEGEDLY ENGAGED IN DECEPTIVE ORMANIPULATIVE ACTS AS DEFINED UNDER RULE 111(01) AND (02) OF THERULES PURSUANT TO THE IDAHO SECURITIES ACT (IDAHO IDAPA12.01.08.111). RESPONDENT BATTEN ALLEGEDLY VIOLATED IDAHO CODESECTION 30-1403(3). RESPONDENTS LODGE AND MULTI-FINANCIALALLEGEDLY FAILED TO DILIGENTLY SUPERVISE THE SECURITIESACTIVITIES OF RESPONDENT BATTEN AND ALLEGEDLY VIOLATED RULE119(01) AND (03) OF THE RULES PURSUANT TO THE IDAHO SECURITEISACT (IDAHO IDAPA 12.01.08.119)











IN THE ORDER, MULTI-FINANCIAL AGREED TO OFFER RESCISSION TO 4INVESTORS IN EXCHANGE FOR TENDER OF THEIR EAG SHARES.




Resolution:

Other Sanctions Ordered: N/A

Sanction Details: THE TOTAL AMOUNT OF RESCISSION IS ESTIMATED TO BE APPX.$119,000.00. RESPONDENTS LODGE AND MULTI-FINANCIAL AGREE TO PAYCOMPLAINANT A FINE IN THE AMOUNT OF $3,000.00 AND INVESTIGATIVECOSTS IN THE AMOUNT OF $2,000.00.

Sanctions Ordered: Monetary/Fine $3,000.00Disgorgement/Restitution

Order

Disclosure 11 of 11

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Initiated By: TEXAS STATE SECURITIES BOARD




Docket/Case Number: CEN/FIN-1165

URL for Regulatory Action:

Principal Product Type:


Allegations: Not Provided



Resolution:


Order







Sanction Details: ON FEBRUARY 5, 1997, THE SECURITIES COMMISSIONERENTERED AN ORDER AGAINST MULTI-FINANCIAL SECURITIES CORP.RESPONDENT OPERATED A BRANCH OFFICE WITHOUT HAVING ITPROPERLYREGISTERED WITH THE SECURITIES COMMISSIONER IN TEXAS ASREQUIRED BY RULE 115.1(h) OF THE RULES & REGULATIONS OF THESTATE SECURITIES BOARD. PURSUANT TO SECTION 14 AND SECTION 23-1OF THE SECURITIES ACT AN ORDER OF REPRIMAND IS ISSUED AND THEYWERE FINED $5,000.00.

Regulator Statement CONTACT: JOYCE MILLER (512) 305-8390



Initiated By: STATE OF TEXAS


Other


CONSENT ORDER TO PROPERLY REGISTER ALL BRANCH OFFICES IN THEFUTURE; FINE OF $5,000


Docket/Case Number: N/A



Allegations: REGISTERED BRANCH OFFICE IN STATE OF TEXAS AFTER OPERATIONSBEGAN



Resolution:


Sanction Details: CONSENT ORDER WAS SIGNED AND $5,000 FINE WAS PAID

Firm Statement STATE OF TEXAS ASSESSED $5,000 FINE FOR OPERATING IMPROPERLYREGISTERED BRANCH OFFICE. FIRM PAID FINE AND SUBSEQUENTLYTERMINATED BRANCH OFFICE AND REPRESENTATIVES.


Consent






Civil - Pending

This type of disclosure event involves a pending civil court action that with seek an injunction to cease certain investment-related activity or alleges a violation of any investment-related statute or regulation.

Disclosure 1 of 1


AUGUST 29, 2019, SEC COMPLAINT FILED: PLAINTIFF UNITED STATESSECURITIES AND EXCHANGE COMMISSION (THE "SEC") ALLEGES ASFOLLOWS AGAINST DEFENDANT CETERA ADVISORS LLC ("CETERA").CETERA, A SEC-REGISTERED INVESTMENT ADVISER, BREACHED ITSFIDUCIARY DUTY AND REGULARLY AND REPEATEDLY PUT ITS FINANCIALINTERESTS AHEAD OF ITS CLIENTS. CETERA RECEIVED MORE THAN $10MILLION FROM BREACHING ITS FIDUCIARY DUTY AND DEFRAUDING ITSCLIENTS. INVESTORS PAID CETERA TO SELECT AND MANAGE THEIRINVESTMENTS IN A MANNER CONSISTENT WITH CETERA'S FIDUCIARYDUTY, BUT CETERA CONTINUOUSLY RECOMMENDED AND INVESTEDCLIENT ASSETS IN INVESTMENTS THAT COST CLIENTS MORE WHEN LESSEXPENSIVE, IDENTICAL INVESTMENTS WERE AVAILABLE. CETERA ALSOFAILED TO DISCLOSE THAT IT HAD NUMEROUS, MATERIAL CONFLICTS OFINTEREST IN PROVIDING INVESTMENT ADVICE TO ITS CLIENTS,INCLUDING THAT SOME INVESTMENT CHOICES GENERATED MILLIONS OFDOLLARS OF ADDITIONAL REVENUE FOR CETERA, WHILE OTHERINVESTMENT CHOICES WOULD HAVE GENERATED MUCH LESS OR NOADDITIONAL REVENUE. OVER THE COURSE OF SEVERAL YEARS, CETERADEFRAUDED ITS ADVISORY CLIENTS AND REPEATEDLY BREACHED ITSFIDUCIARY DUTIES THAT IT OWED TO THEM IN FOUR PRIMARY WAYS.FIRST, CETERA BREACHED ITS FIDUCIARY DUTY TO ITS CLIENTS ANDFAILED TO ACT IN ITS CLIENTS' BEST INTERESTS BY A) SELECTING ANDHOLDING MUTUAL FUND INVESTMENTS THAT COST ITS CLIENTS MORE(AND PAID CETERA MORE) WHEN IT KNEW THAT LOWER-COST,OTHERWISE IDENTICAL INVESTMENTS WERE AVAILABLE TO ITS CLIENTSAND B) FAILING TO PROPERLY DISCLOSE THIS PRACTICE OR ITSCONFLICT OF INTEREST. SECOND, CETERA BREACHED ITS FIDUCIARYDUTY TO ITS CLIENTS IN CONNECTION WITH ITS RECEIPT OFCOMPENSATION FROM A THIRD-PARTY BROKER-DEALER (THE "CLEARINGBROKER") THAT IT RECEIVED FOR INVESTING CETERA'S ADVISORYCLIENTS IN CERTAIN MUTUAL FUNDS (HEREINAFTER, "REVENUESHARING"). IN THIS ARRANGEMENT, CETERA HAD A CLEAR CONFLICT OFINTEREST IN THAT IT RECEIVED ADDITIONAL COMPENSATION FORINVESTING CLIENTS IN CERTAIN MUTUAL FUNDS THAT PAID REVENUESHARING OVER OTHER MUTUAL FUNDS THAT DID NOT, AND BECAUSETHIS ARRANGEMENT PROVIDED A FINANCIAL INCENTIVE FOR CETERA TOMAINTAIN ITS RELATIONSHIP WITH THE CLEARING BROKER SO IT COULDCONTINUE TO RECEIVE REVENUE SHARING. THIRD, CETERA ALSO FAILEDTO DISCLOSE THE CONFLICT STEMMING FROM ITS RECEIPT OF AT LEAST$1.7 MILLION OF COMPENSATION THAT CERTAIN MUTUAL FUNDS PAID TOTHE CLEARING BROKER, WHICH THE CLEARING BROKER THEN SHAREDWITH CETERA. CETERA FAILED TO DISCLOSE ADEQUATELY TO ITSCLIENTS THIS ARRANGEMENT AND THE RESULTING CONFLICT OFINTEREST. FOURTH, CETERA DIRECTED THE CLEARING BROKER TOMARK-UP CERTAIN FEES ("NON-TRANSACTION FEES") BY UP TO 300%THAT THE CLEARING BROKER CHARGED CETERA'S ADVISORY CLIENTS.AFTER THE CLEARING BROKER RECEIVED THESE FEES FROM CETERA'SCLIENTS, THE CLEARING BROKER PAID THESE FEES TO CETERA. CETERAFAILED TO DISCLOSE THIS PRACTICE, THE ADDITIONAL FEES THATCETERA CHARGED, OR THE RESULTING CONFLICT TO ITS ADVISORYCLIENTS. CETERA FAILED TO IMPLEMENT WRITTEN POLICIES ANDPROCEDURES REASONABLY DESIGNED TO PREVENT ITS BREACH OFFIDUCIARY DUTY. THROUGH THE CONDUCT, CETERA HAS VIOLATEDSECTIONS 206(2) AND 206(4) OF THE ADVISERS ACT AND RULE 206(4)-7.

Allegations:

Current Status: Pending






Initiated By: THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Relief Sought: Injunction

Other Relief Sought: PERMANENTLY RESTRAINING, DISGORGE ANY AND ALL ILL-GOTTENGAINS, PAY CIVIL PENALTIES,

Date Court Action Filed: 08/29/2019


Other Product Types: UNSPECIFIED SECURITIES

Court Details: THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO;COLORADO; 1:19-CV-02461

AUGUST 29, 2019, SEC COMPLAINT FILED: PLAINTIFF UNITED STATESSECURITIES AND EXCHANGE COMMISSION (THE "SEC") ALLEGES ASFOLLOWS AGAINST DEFENDANT CETERA ADVISORS LLC ("CETERA").CETERA, A SEC-REGISTERED INVESTMENT ADVISER, BREACHED ITSFIDUCIARY DUTY AND REGULARLY AND REPEATEDLY PUT ITS FINANCIALINTERESTS AHEAD OF ITS CLIENTS. CETERA RECEIVED MORE THAN $10MILLION FROM BREACHING ITS FIDUCIARY DUTY AND DEFRAUDING ITSCLIENTS. INVESTORS PAID CETERA TO SELECT AND MANAGE THEIRINVESTMENTS IN A MANNER CONSISTENT WITH CETERA'S FIDUCIARYDUTY, BUT CETERA CONTINUOUSLY RECOMMENDED AND INVESTEDCLIENT ASSETS IN INVESTMENTS THAT COST CLIENTS MORE WHEN LESSEXPENSIVE, IDENTICAL INVESTMENTS WERE AVAILABLE. CETERA ALSOFAILED TO DISCLOSE THAT IT HAD NUMEROUS, MATERIAL CONFLICTS OFINTEREST IN PROVIDING INVESTMENT ADVICE TO ITS CLIENTS,INCLUDING THAT SOME INVESTMENT CHOICES GENERATED MILLIONS OFDOLLARS OF ADDITIONAL REVENUE FOR CETERA, WHILE OTHERINVESTMENT CHOICES WOULD HAVE GENERATED MUCH LESS OR NOADDITIONAL REVENUE. OVER THE COURSE OF SEVERAL YEARS, CETERADEFRAUDED ITS ADVISORY CLIENTS AND REPEATEDLY BREACHED ITSFIDUCIARY DUTIES THAT IT OWED TO THEM IN FOUR PRIMARY WAYS.FIRST, CETERA BREACHED ITS FIDUCIARY DUTY TO ITS CLIENTS ANDFAILED TO ACT IN ITS CLIENTS' BEST INTERESTS BY A) SELECTING ANDHOLDING MUTUAL FUND INVESTMENTS THAT COST ITS CLIENTS MORE(AND PAID CETERA MORE) WHEN IT KNEW THAT LOWER-COST,OTHERWISE IDENTICAL INVESTMENTS WERE AVAILABLE TO ITS CLIENTSAND B) FAILING TO PROPERLY DISCLOSE THIS PRACTICE OR ITSCONFLICT OF INTEREST. SECOND, CETERA BREACHED ITS FIDUCIARYDUTY TO ITS CLIENTS IN CONNECTION WITH ITS RECEIPT OFCOMPENSATION FROM A THIRD-PARTY BROKER-DEALER (THE "CLEARINGBROKER") THAT IT RECEIVED FOR INVESTING CETERA'S ADVISORYCLIENTS IN CERTAIN MUTUAL FUNDS (HEREINAFTER, "REVENUESHARING"). IN THIS ARRANGEMENT, CETERA HAD A CLEAR CONFLICT OFINTEREST IN THAT IT RECEIVED ADDITIONAL COMPENSATION FORINVESTING CLIENTS IN CERTAIN MUTUAL FUNDS THAT PAID REVENUESHARING OVER OTHER MUTUAL FUNDS THAT DID NOT, AND BECAUSETHIS ARRANGEMENT PROVIDED A FINANCIAL INCENTIVE FOR CETERA TOMAINTAIN ITS RELATIONSHIP WITH THE CLEARING BROKER SO IT COULDCONTINUE TO RECEIVE REVENUE SHARING. THIRD, CETERA ALSO FAILEDTO DISCLOSE THE CONFLICT STEMMING FROM ITS RECEIPT OF AT LEAST$1.7 MILLION OF COMPENSATION THAT CERTAIN MUTUAL FUNDS PAID TOTHE CLEARING BROKER, WHICH THE CLEARING BROKER THEN SHAREDWITH CETERA. CETERA FAILED TO DISCLOSE ADEQUATELY TO ITSCLIENTS THIS ARRANGEMENT AND THE RESULTING CONFLICT OFINTEREST. FOURTH, CETERA DIRECTED THE CLEARING BROKER TOMARK-UP CERTAIN FEES ("NON-TRANSACTION FEES") BY UP TO 300%THAT THE CLEARING BROKER CHARGED CETERA'S ADVISORY CLIENTS.AFTER THE CLEARING BROKER RECEIVED THESE FEES FROM CETERA'SCLIENTS, THE CLEARING BROKER PAID THESE FEES TO CETERA. CETERAFAILED TO DISCLOSE THIS PRACTICE, THE ADDITIONAL FEES THATCETERA CHARGED, OR THE RESULTING CONFLICT TO ITS ADVISORYCLIENTS. CETERA FAILED TO IMPLEMENT WRITTEN POLICIES ANDPROCEDURES REASONABLY DESIGNED TO PREVENT ITS BREACH OFFIDUCIARY DUTY. THROUGH THE CONDUCT, CETERA HAS VIOLATEDSECTIONS 206(2) AND 206(4) OF THE ADVISERS ACT AND RULE 206(4)-7.


AUGUST 29, 2019, SEC COMPLAINT FILED: PLAINTIFF UNITED STATESSECURITIES AND EXCHANGE COMMISSION (THE "SEC") ALLEGES ASFOLLOWS AGAINST DEFENDANT CETERA ADVISORS LLC ("CETERA").CETERA, A SEC-REGISTERED INVESTMENT ADVISER, BREACHED ITSFIDUCIARY DUTY AND REGULARLY AND REPEATEDLY PUT ITS FINANCIALINTERESTS AHEAD OF ITS CLIENTS. CETERA RECEIVED MORE THAN $10MILLION FROM BREACHING ITS FIDUCIARY DUTY AND DEFRAUDING ITSCLIENTS. INVESTORS PAID CETERA TO SELECT AND MANAGE THEIRINVESTMENTS IN A MANNER CONSISTENT WITH CETERA'S FIDUCIARYDUTY, BUT CETERA CONTINUOUSLY RECOMMENDED AND INVESTEDCLIENT ASSETS IN INVESTMENTS THAT COST CLIENTS MORE WHEN LESSEXPENSIVE, IDENTICAL INVESTMENTS WERE AVAILABLE. CETERA ALSOFAILED TO DISCLOSE THAT IT HAD NUMEROUS, MATERIAL CONFLICTS OFINTEREST IN PROVIDING INVESTMENT ADVICE TO ITS CLIENTS,INCLUDING THAT SOME INVESTMENT CHOICES GENERATED MILLIONS OFDOLLARS OF ADDITIONAL REVENUE FOR CETERA, WHILE OTHERINVESTMENT CHOICES WOULD HAVE GENERATED MUCH LESS OR NOADDITIONAL REVENUE. OVER THE COURSE OF SEVERAL YEARS, CETERADEFRAUDED ITS ADVISORY CLIENTS AND REPEATEDLY BREACHED ITSFIDUCIARY DUTIES THAT IT OWED TO THEM IN FOUR PRIMARY WAYS.FIRST, CETERA BREACHED ITS FIDUCIARY DUTY TO ITS CLIENTS ANDFAILED TO ACT IN ITS CLIENTS' BEST INTERESTS BY A) SELECTING ANDHOLDING MUTUAL FUND INVESTMENTS THAT COST ITS CLIENTS MORE(AND PAID CETERA MORE) WHEN IT KNEW THAT LOWER-COST,OTHERWISE IDENTICAL INVESTMENTS WERE AVAILABLE TO ITS CLIENTSAND B) FAILING TO PROPERLY DISCLOSE THIS PRACTICE OR ITSCONFLICT OF INTEREST. SECOND, CETERA BREACHED ITS FIDUCIARYDUTY TO ITS CLIENTS IN CONNECTION WITH ITS RECEIPT OFCOMPENSATION FROM A THIRD-PARTY BROKER-DEALER (THE "CLEARINGBROKER") THAT IT RECEIVED FOR INVESTING CETERA'S ADVISORYCLIENTS IN CERTAIN MUTUAL FUNDS (HEREINAFTER, "REVENUESHARING"). IN THIS ARRANGEMENT, CETERA HAD A CLEAR CONFLICT OFINTEREST IN THAT IT RECEIVED ADDITIONAL COMPENSATION FORINVESTING CLIENTS IN CERTAIN MUTUAL FUNDS THAT PAID REVENUESHARING OVER OTHER MUTUAL FUNDS THAT DID NOT, AND BECAUSETHIS ARRANGEMENT PROVIDED A FINANCIAL INCENTIVE FOR CETERA TOMAINTAIN ITS RELATIONSHIP WITH THE CLEARING BROKER SO IT COULDCONTINUE TO RECEIVE REVENUE SHARING. THIRD, CETERA ALSO FAILEDTO DISCLOSE THE CONFLICT STEMMING FROM ITS RECEIPT OF AT LEAST$1.7 MILLION OF COMPENSATION THAT CERTAIN MUTUAL FUNDS PAID TOTHE CLEARING BROKER, WHICH THE CLEARING BROKER THEN SHAREDWITH CETERA. CETERA FAILED TO DISCLOSE ADEQUATELY TO ITSCLIENTS THIS ARRANGEMENT AND THE RESULTING CONFLICT OFINTEREST. FOURTH, CETERA DIRECTED THE CLEARING BROKER TOMARK-UP CERTAIN FEES ("NON-TRANSACTION FEES") BY UP TO 300%THAT THE CLEARING BROKER CHARGED CETERA'S ADVISORY CLIENTS.AFTER THE CLEARING BROKER RECEIVED THESE FEES FROM CETERA'SCLIENTS, THE CLEARING BROKER PAID THESE FEES TO CETERA. CETERAFAILED TO DISCLOSE THIS PRACTICE, THE ADDITIONAL FEES THATCETERA CHARGED, OR THE RESULTING CONFLICT TO ITS ADVISORYCLIENTS. CETERA FAILED TO IMPLEMENT WRITTEN POLICIES ANDPROCEDURES REASONABLY DESIGNED TO PREVENT ITS BREACH OFFIDUCIARY DUTY. THROUGH THE CONDUCT, CETERA HAS VIOLATEDSECTIONS 206(2) AND 206(4) OF THE ADVISERS ACT AND RULE 206(4)-7.CETERA ADVISORS IS CONFIDENT THAT ITS DISCLOSURES WEREADEQUATE AND THAT IT HAS COMPLIED WITH THE SECURITIES LAWS.ACCORDINGLY, THE FIRM BELIEVES THAT IT HAS SIGNIFICANT DEFENSESTO THE SEC'S ALLEGATIONS THAT MAY RESULT IN A FAVORABLE RULINGON THE MERITS.

Allegations:

Current Status: Pending












Initiated By: THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Relief Sought: Injunction

Other Relief Sought: PERMANENTLY RESTRAINING, DISGORGE ANY AND ALL ILL-GOTTENGAINS, PAY CIVIL PENALTIES

Date Court Action Filed: 08/29/2019


Other Product Types: UNSPECIFIED SECURITIES

Court Details: THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO;COLORADO; 1:19-CV-02461







Arbitration Award - Award / Judgment

Brokerage firms are not required to report arbitration claims filed against them by customers; however, BrokerCheckprovides summary information regarding FINRA arbitration awards involving securities and commodities disputesbetween public customers and registered securities firms in this section of the report. The full text of arbitration awards issued by FINRA is available at www.finra.org/awardsonline.

Disclosure 1 of 7


Type of Event: ARBITRATION

Arbitration Forum:

Case Initiated:

Case Number:

Allegations:

Disputed Product Type:

Sum of All Relief Requested:

Disposition:

Disposition Date:

Sum of All Relief Awarded:

NASD

11/01/2001

01-05823

ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNT RELATED-BREACH OF CONTRACT; ACCOUNTRELATED-FAILURE TO SUPERVISE

DO NOT USE-NO OTHER TYPE OF SEC INVOLVE; UNKNOWN TYPE OFSECURITIES

$895,000.00

AWARD AGAINST PARTY

05/09/2003

$46,450.01

There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.

Disclosure 2 of 7

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:

NASD

03/16/2005

05-00575

ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNT RELATED-FAILURE TO SUPERVISE; ACCOUNTRELATED-NEGLIGENCE





www.finra.org/awardsonline

https://www.finra.org/arbitration-mediation/arbitration-awards-online?search=01-05823





Disposition:

Disposition Date:


ANNUITIES; DO NOT USE-NO OTHER TYPE OF SEC INVOLVE

$311,932.90

AWARD AGAINST PARTY

12/23/2005

$125,000.02


Disclosure 3 of 7

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

05/09/2007

07-01426

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT RELATED-BREACH OF CONTRACT;ACCOUNT RELATED-NEGLIGENCE

DO NOT USE-NO OTHER TYPE OF SEC INVOLVE; OTHER TYPES OFSECURITIES

$37,000.00

AWARD AGAINST PARTY

12/21/2007

$37,153.95


Disclosure 4 of 7

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Arbitration Forum:

Allegations:

FINRA

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-OMISSION OF FACTS; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNTRELATED-NEGLIGENCE







Arbitration Forum:

Case Initiated:

Case Number:



Disposition:

Disposition Date:


FINRA

12/10/2008

08-04600

COMMON STOCK; DO NOT USE-NO OTHER TYPE OF SEC INVOLVE;MUTUAL FUNDS

$410,710.92

AWARD AGAINST PARTY

07/31/2009

$52,050.02


Disclosure 5 of 7

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


FINRA

01/06/2012

11-04766

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSION OF FACTS;ACCOUNT ACTIVITY-OTHER; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNTRELATED-FAILURE TO SUPERVISE; ACCOUNT RELATED-NEGLIGENCE; DONOT USE-OTHER-OTHER

OTHER TYPES OF SECURITIES

$3,000,001.00

AWARD AGAINST PARTY

08/29/2013

$111,000.00


Disclosure 6 of 7

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


FINRA

06/15/2018

18-02210

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-FRAUD;ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSIONOF FACTS; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNT ACTIVITY-VIOLATEOF BLUE SKY LWS; ACCOUNT RELATED-BREACH OF CONTRACT; ACCOUNTRELATED-FAILURE TO SUPERVISE; ACCOUNT RELATED-NEGLIGENCE;ACCOUNT RELATED-OTHER

REAL ESTATE INVESTMENT TRUST

$50,000.00

AWARD AGAINST PARTY

10/17/2018

$43,500.01


Disclosure 7 of 7

i



Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

11/02/1994

94-03157

ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSIONOF FACTS; ACCOUNT RELATED-FAILURE TO SUPERVISE; DO NOT USE-NOOTHER CONTROVERSY INVOLVED

DO NOT USE-NO OTHER TYPE OF SEC INVOLVE; LIMITED PARTNERSHIPS

$66,812.17

AWARD AGAINST PARTY

10/19/1995

$66,812.1754©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC







Sum of All Relief Awarded: $66,812.17







End of Report

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CETERA ADVISORS LLC · CRD# 10299 SEC# 8-26892 Main Office Location 4600 SOUTH SYRACUSE STREET SUITE 600 DENVER, CO 80237 Regulated by FINRA Denver Office Mailing Address 4600 SOUTH