With regulators zeroing in on reverse-churning, and lawsuits popping up around the practice, advisers should be paying attention.   The concern stems from conflicts of interest that advisers face when deciding whether to move clients from commission-based accounts to often more expensive fee-based accounts (depending on how much trading occurs, which additional services are provided and how much the fee is). But some advisers have felt pushed in that direction regardless of the circumstances, especially in retirement accounts, because »

Four Edward D. Jones & Co. customers have filed a class-action lawsuit against the company and its executives, asserting that its aggressive promotion of fee-based advisory accounts is an illegal “reverse churning scheme” benefiting the firm at the expense of investors.   The complaint, filed in federal court in the Eastern District of California on March 30, said the firm has pressured its more than 16,000 brokers to switch their largely middle-income brokerage customers from commission accounts into advisory accounts that »

A $9-million trio of UBS brokers in Houston left last week to form an independent advisory firm, betting they can retain the bulk of their ultra-rich family clientele in spite of the firm’s recent exit from the Protocol for Broker Recruiting.   Brian Bova, David Leeds Eustis and Marc Oster, managing directors who had each been at UBS for at least 15 years, have set up Inscription Capital as an advisory firm, financing the transition with money from GPS Investment Partners, a private equity firm in New York, according to several »

The Securities and Exchange Commission on Thursday said PNC Investments, Securities America Advisors, and Geneos Wealth Management agreed to settle fiduciary duty breach charges related to mutual fund sales by paying $15 million in penalties and restitution to customers.   The three firms each settled charges of putting customers who were paying fees in advisory programs into A-share funds that charged ‘12b-1’ marketing and distribution fees when cheaper institutional share classes were available.   PNC Investments agreed to »

In a promotion that appears aimed at replenishing its scandal-depleted salesforce, Wells Fargo & Co. on Thursday unrolled a super-charged “referral” fee for headhunters who bring eligible recruits to any of the bank’s five wealth management channels.   Its Wells Fargo Advisors unit will pay 10% of a candidate broker’s trailing 12-month revenue if he or she is hired between now and September 30 of this year, according to a letter agreement reviewed by AdvisorHub that was sent by Sarah K Warren, the St. Louis-based »