CETERA ADVISORS LLC · CRD# 10299 SEC# 8-26892 Main Office Location 4600 SOUTH SYRACUSE STREET...
Transcript of CETERA ADVISORS LLC · CRD# 10299 SEC# 8-26892 Main Office Location 4600 SOUTH SYRACUSE STREET...
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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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
400 FIRST STREET SOUTHSUITE 300SAINT CLOUD, MN 56301
400 FIRST STREET SOUTHSUITE 300SAINT CLOUD, MN 56301
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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
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
BOWMAN, TIMOTHY JOSEPH
PRINCIPAL FINANCIAL OFFICER
Less than 5%
No
Individual
10/2018
Yes
2247374
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
Position
Percentage of Ownership
Position Start Date
HALEY, KRISTY MARIE
ADVISORY CHIEF COMPLIANCE OFFICER
Less than 5%
Individual
11/2015
4022155
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
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Direct Owners and Executive Officers (continued)
Firm Profile
Percentage of Ownership
Is this a public reportingcompany?
Does this owner direct themanagement or policies ofthe firm?
Less than 5%
No
Yes
Position
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
HARRISON, BRETT LAMAR
MANAGER AND CHIEF EXECUTIVE OFFICER
Less than 5%
No
Individual
10/2009
Yes
4032238
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
Position
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
KESTERSON, BARBARA JO
PRINCIPAL OPERATIONS OFFICER
Less than 5%
No
Individual
10/2018
Yes
2747533
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
NEARY, JOSEPH DANIEL
2993505
Legal Name & CRD# (if any):
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Direct Owners and Executive Officers (continued)
Firm Profile
Position
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
MANAGER
Less than 5%
No
Individual
05/2019
Yes
2993505
Is this a domestic or foreignentity or an individual?
Position
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
OLSON, GREGORY ALAN
ASSISTANT SECRETARY
Less than 5%
No
Individual
07/2016
Yes
2692482
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
Position
Percentage of Ownership
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
RAMOS, RAMON
MONEY LAUNDERING REPORTING OFFICER
Less than 5%
Individual
02/2013
No
2160203
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
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Direct Owners and Executive Officers (continued)
Firm Profile
Is this a public reportingcompany?
Does this owner direct themanagement or policies ofthe firm?
No
No
Position
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
SCHOTT, MARY FRANCES
PRESIDENT
Less than 5%
No
Individual
02/2018
Yes
1453429
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
Position
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
SHELSON, MARK PAUL
TREASURER
Less than 5%
No
Individual
07/2016
Yes
1819252
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
SMILEY, STANLEY ROBERT
Individual
3004604
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
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Direct Owners and Executive Officers (continued)
Firm Profile
Position
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
VICE PRESIDENT
Less than 5%
No
Individual
02/2006
Yes
Is this a domestic or foreignentity or an individual?
Position
Percentage of Ownership
Is this a public reportingcompany?
Position Start Date
Does this owner direct themanagement or policies ofthe firm?
VANNOY-PINEDA, KATHLEEN DENISE
SENIOR VICE PRESIDENT, BD CHIEF COMPLIANCE OFFICER ANDSECRETARY
Less than 5%
No
Individual
11/2017
Yes
1347526
Is this a domestic or foreignentity or an individual?
Legal Name & CRD# (if any):
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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
Legal Name & CRD# (if any):
Is this a domestic or foreignentity or an individual?
Company through whichindirect ownership isestablished
Relationship to Direct Owner
Relationship Established
Percentage of Ownership
Does this owner direct themanagement or policies ofthe firm?
Is this a public reportingcompany?
CETERA FINANCIAL HOLDINGS, INC
SOLE MEMBER
CETERA FINANCIAL GROUP, INC
75% or more
No
Domestic Entity
11/2009
Yes
Legal Name & CRD# (if any):
Is this a domestic or foreignentity or an individual?
Company through whichindirect ownership isestablished
Relationship to Direct Owner
Relationship Established
Percentage of Ownership
Does this owner direct themanagement or policies ofthe firm?
Is this a public reportingcompany?
GC TWO HOLDINGS, INC.
GC TWO INTERMEDIATE HOLDINGS, INC.
Domestic Entity
Legal Name & CRD# (if any):
Is this a domestic or foreignentity or an individual?
Company through whichindirect ownership isestablished
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Indirect Owners (continued)
Firm Profile
OWNER
GC TWO INTERMEDIATE HOLDINGS, INC.
Other General Partners
No
10/2018
Yes
Company through whichindirect ownership isestablished
Relationship to Direct Owner
Relationship Established
Percentage of Ownership
Does this owner direct themanagement or policies ofthe firm?
Is this a public reportingcompany?
GC TWO INTERMEDIATE HOLDINGS, INC.
OWNER
ARETEC GROUP, INC.
Other General Partners
No
Domestic Entity
10/2018
Yes
Legal Name & CRD# (if any):
Is this a domestic or foreignentity or an individual?
Company through whichindirect ownership isestablished
Relationship to Direct Owner
Relationship Established
Percentage of Ownership
Does this owner direct themanagement or policies ofthe firm?
Is this a public reportingcompany?
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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.
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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
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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
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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.
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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
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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
Effective Date: 05/01/2020
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
Effective Date: 03/02/2020
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
Effective Date: 07/15/2017
Description: BRANCH INSPECTION MODULES FOR MONITORING AND RECORDRETENTION
Name: MARKETINGPRO, INC.
Business Address: 14525 SW MILLIKAN WAY#78359BEAVERTON, OR 97005
Effective Date: 05/24/2013
Description: WEB BASED SALES LITERATURE AND RECORD RETENTION SYSTEM
Name: SMARSH
Business Address: 851 SW 6TH AVE #800PORTLAND, OR 97204
Effective Date: 11/01/2015
Description: ELECTRONIC RECORD KEEPER FOR ARCHIVING EMAILS, INSTANTMESSAGES, SOCIAL MEDIA AND TRADE BLOTTERS.
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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
Effective Date: 02/13/2009
Description: ELECTRONIC RECORD KEEPER FOR ORDER TICKETS.
Name: IRON MOUNTAIN INFORMATION MANAGEMENT, LLC
Business Address: 4577 E 46TH AVEDENVER, CO 80239
Effective Date: 07/01/1996
Description: HARD COPY OFFSITE STORAGE OF GENERAL BD RECORDS.
Name: IRON MOUNTAIN INFORMATION MANAGEMENT, LLC
Business Address: 700 DISTRIBUTION DRIVEATLANTA, GA 30336
Effective Date: 08/01/2011
Description: HARD COPY OFFSITE STORAGE OF GENERAL BD RECORDS.
Name: VERITAS TECHNOLOGIES, INC.
Business Address: 2780 SKYPARK DRIVE, #300TORRANCE, CA 90505
Effective Date: 07/01/2004
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
Effective Date: 11/28/2007
Description: ELECTRONIC RECORD KEEPER FOR GENERAL ACCOUNTDOCUMENTATION AND PROCESSING
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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.
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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:
Investment AdvisoryActivities:
Securities Activities:
Country:
Foreign Entity:
Effective Date:
Business Address:
CRD #:
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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.
APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFARETEC GROUP, INC.
Description:
Investment AdvisoryActivities:
Securities Activities:
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.
APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFARETEC GROUP, INC.
Description:
Investment AdvisoryActivities:
Securities Activities:
Country:
Foreign Entity:
Effective Date:
Business Address:
CRD #:
01/03/2013
200 N PACIFIC COAST HWY STE 1300EL SEGUNDO, CA 90245
165436
CETERA INVESTMENT MANAGEMENT LLC is under common control with the firm.
Effective Date:
Business Address:
CRD #:
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Firm Operations
Organization Affiliates (continued)
Yes
No
No
01/03/2013
APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFCETERA FINANCIAL GROUP, INC.
Description:
Investment AdvisoryActivities:
Securities Activities:
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.
APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFCETERA FINANCIAL GROUP, INC.
Description:
Investment AdvisoryActivities:
Securities Activities:
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.
APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFCETERA FINANCIAL GROUP, INC.
Description:
Investment AdvisoryActivities:
Securities Activities:
Country:
Foreign Entity:
Effective Date:
Business Address:
CRD #:
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Firm Operations
Organization Affiliates (continued)
APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFCETERA FINANCIAL GROUP, INC.
Description:
Yes
Yes
No
12/13/2000
200 N PACIFIC COAST HWY STE 1300EL SEGUNDO, CA 90245
13572
CETERA ADVISOR NETWORKS LLC is under common control with the firm.
APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFCETERA FINANCIAL GROUP, INC.
Description:
Investment AdvisoryActivities:
Securities Activities:
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.
APPLICANT AND CONTROL AFFILIATE ARE UNDER COMMON CONTROL OFCETERA FINANCIAL GROUP, INC.
Description:
Investment AdvisoryActivities:
Securities Activities:
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
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Firm Operations
Organization Affiliates (continued)
· state non-member bank· savings bank or association· credit union· or foreign bank
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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
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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
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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.
Current Status: Final
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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: 03/30/2017
Docket/Case Number: S-17-0007
Principal Product Type: Equity Listed (Common & Preferred Stock)
Other Product Type(s):
Allegations: DFR ALLEGED VIOLATION OF THE SUITABILITY RULE AND FAILURE TOSUPERVISE. CETERA ADVISORS, LLC AND MR. MERHOFF NEITHERADMITTED NOR DENIED THE ALLEGATIONS.
Resolution Date: 03/03/2017
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.
Sanctions Ordered: Monetary/Fine $70,000.00Cease and Desist/Injunction
Consent
Disclosure 2 of 11
i
Reporting Source: Regulator
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.
Current Status: Final
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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.
27©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
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Initiated By: FINRA
Principal Sanction(s)/ReliefSought:
Other Sanction(s)/ReliefSought:
Date Initiated: 05/03/2017
Docket/Case Number: 2016050259001
Principal Product Type: Mutual Fund(s)
Other Product Type(s):
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.
Resolution Date: 05/03/2017
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.
Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?
No
Sanctions Ordered: CensureDisgorgement/Restitution
Acceptance, Waiver & Consent(AWC)
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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.
iReporting Source: Firm
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.
Current Status: Final
29©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
www.finra.org/brokercheck User Guidance
Initiated By: FINRA
Principal Sanction(s)/ReliefSought:
Other Sanction(s)/ReliefSought:
Date Initiated: 05/03/2017
Docket/Case Number: 2016050259001
Principal Product Type: Money Market Fund(s)
Other Product Type(s):
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.
Resolution Date: 05/03/2017
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.
Sanctions Ordered: CensureDisgorgement/Restitution
Acceptance, Waiver & Consent(AWC)
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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.
Disclosure 3 of 11
i
Reporting Source: Regulator
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.
Current Status: Final
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Initiated By: FINRA
Principal Sanction(s)/ReliefSought:
Other
Other Sanction(s)/ReliefSought:
N/A
Date Initiated: 10/19/2015
Docket/Case Number: 2014041676801
Principal Product Type: Unit Investment Trust(s)
Other Product Type(s):
Resolution Date: 10/19/2015
Resolution:
Other Sanctions Ordered:
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.
Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?
No
Sanctions Ordered: CensureMonetary/Fine $250,000.00Disgorgement/Restitution
Acceptance, Waiver & Consent(AWC)
iReporting Source: Firm
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.
Current Status: Final
32©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
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Initiated By: FINRA
Principal Sanction(s)/ReliefSought:
Other
Other Sanction(s)/ReliefSought:
N/A
Date Initiated: 10/19/2015
Docket/Case Number: 2014041676801
Principal Product Type: Unit Investment Trust(s)
Other Product Type(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 Date: 10/19/2015
Resolution:
Other Sanctions Ordered:
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
Acceptance, Waiver & Consent(AWC)
Disclosure 4 of 11
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Reporting Source: Regulator
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.
Current Status: Final
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Initiated By: FINRA
Principal Sanction(s)/ReliefSought:
Other Sanction(s)/ReliefSought:
Date Initiated: 03/23/2009
Docket/Case Number: 2005001166601
Principal Product Type: No Product
Other Product Type(s):
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 Date: 03/23/2009
Resolution:
Other Sanctions Ordered:
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.
Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?
No
Sanctions Ordered: CensureMonetary/Fine $150,000.00
Acceptance, Waiver & Consent(AWC)
iReporting Source: Firm
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.
Current Status: Final
Appealed To and Date AppealFiled:
N/A
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Initiated By: FINANCIAL INDUSTRY REGULATORY AUTHORITY
Principal Sanction(s)/ReliefSought:
Censure
Other Sanction(s)/ReliefSought:
A FINE IN THE AMOUNT OF $150,000.
Date Initiated: 05/30/2006
Docket/Case Number: NO. 2005001166601
Principal Product Type: No Product
Other Product Type(s):
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 Date: 03/23/2009
Resolution:
Other Sanctions Ordered:
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.
Sanctions Ordered: CensureMonetary/Fine $150,000.00
Acceptance, Waiver & Consent(AWC)
Disclosure 5 of 11
i
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.
Current Status: Final
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Initiated By: STATE OF NEW YORK INSURANCE DEPARTMENT
Principal Sanction(s)/ReliefSought:
Civil and Administrative Penalt(ies) /Fine(s)
Other Sanction(s)/ReliefSought:
Date Initiated: 01/15/2009
Docket/Case Number: 2008-0227-S
Principal Product Type: No Product
Other Product Type(s):
Resolution Date: 01/27/2009
Resolution:
Other Sanctions Ordered:
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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Reporting Source: Regulator
Initiated By: FINRA
Principal Sanction(s)/ReliefSought:
Date Initiated: 11/01/2007
Docket/Case Number: 2006004754301
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.
Current Status: Final
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Other Sanction(s)/ReliefSought:
Resolution Date: 11/01/2007
Resolution:
Other Sanctions Ordered:
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.
Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?
No
Sanctions Ordered: CensureMonetary/Fine $12,000.00
Acceptance, Waiver & Consent(AWC)
iReporting Source: Firm
Initiated By: FINANCIAL INDUSTRY REGULATORY AUTHORITY
Principal Sanction(s)/ReliefSought:
Censure
Other Sanction(s)/ReliefSought:
FINE OF $12,000.00
Date Initiated: 10/30/2007
Docket/Case Number: 2006004754301
Principal Product Type: Other
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.
Current Status: Final
Resolution: Acceptance, Waiver & Consent(AWC) 37©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
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Resolution Date: 10/30/2007
Resolution:
Other Sanctions Ordered:
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.
Sanctions Ordered: CensureMonetary/Fine $12,000.00
Acceptance, Waiver & Consent(AWC)
Disclosure 7 of 11
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Reporting Source: Regulator
Initiated By: FINRA
Principal Sanction(s)/ReliefSought:
Other Sanction(s)/ReliefSought:
Date Initiated: 09/21/2007
Docket/Case Number: 2007008580401
Principal Product Type: Other
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.
Current Status: Final
Resolution Date: 09/21/2007
Resolution: Acceptance, Waiver & Consent(AWC)
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Resolution Date: 09/21/2007
Other Sanctions Ordered: UNDERTAKING
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.
Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?
No
Sanctions Ordered: CensureMonetary/Fine $10,000.00
iReporting Source: Firm
Initiated By: FINANCIAL INDUSTRY REGULATORY AUTHORITY
Principal Sanction(s)/ReliefSought:
Censure
Other Sanction(s)/ReliefSought:
Date Initiated: 09/21/2007
Docket/Case Number: 20070085804-01
Principal Product Type: Other
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.
Current Status: Final
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Other Sanction(s)/ReliefSought:
Resolution Date: 09/21/2007
Resolution:
Other Sanctions Ordered: UNDERTAKING
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.
Sanctions Ordered: CensureMonetary/Fine $10,000.00
Acceptance, Waiver & Consent(AWC)
Disclosure 8 of 11
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Reporting Source: Regulator
Initiated By: NASD
Principal Sanction(s)/ReliefSought:
Date Initiated: 07/27/2006
Docket/Case Number: EAF0400760002
Principal Product Type: Mutual Fund(s)
Other Product Type(s):
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.
Current Status: Final
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Principal Sanction(s)/ReliefSought:
Other Sanction(s)/ReliefSought:
Resolution Date: 07/27/2006
Resolution:
Other Sanctions Ordered:
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.
Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?
No
Sanctions Ordered: CensureMonetary/Fine $1,228,000.00
Acceptance, Waiver & Consent(AWC)
iReporting Source: Firm
Initiated By: NASD
Principal Sanction(s)/ReliefSought:
Civil and Administrative Penalt(ies) /Fine(s)
Date Initiated: 07/27/2006
Docket/Case Number: EAF0400760002
Principal Product Type: Mutual Fund(s)
Other Product Type(s):
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.
Current Status: Final
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Principal Sanction(s)/ReliefSought:
Civil and Administrative Penalt(ies) /Fine(s)
Other Sanction(s)/ReliefSought:
CENSURE
Resolution Date: 07/27/2006
Resolution:
Other Sanctions Ordered:
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
Acceptance, Waiver & Consent(AWC)
Disclosure 9 of 11
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Reporting Source: Regulator
Initiated By: NASD
Date Initiated: 05/30/2006
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.
Current Status: Final
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Principal Sanction(s)/ReliefSought:
Other Sanction(s)/ReliefSought:
Docket/Case Number: E3A2005000101
Principal Product Type: Mutual Fund(s)
Other Product Type(s):
Resolution Date: 05/30/2006
Resolution:
Other Sanctions Ordered:
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.
Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?
No
Sanctions Ordered: CensureMonetary/Fine $17,500.00
Acceptance, Waiver & Consent(AWC)
iReporting Source: Firm
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.
Current Status: Final
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Initiated By: NATIONAL ASSOCIATION OF SECURITIES DEALERS (NASD)
Principal Sanction(s)/ReliefSought:
Censure
Other Sanction(s)/ReliefSought:
A FINE IN THE AMOUNT OF $17,500.
Date Initiated: 05/30/2006
Docket/Case Number: E3A2005000101
Principal Product Type: No Product
Other Product Type(s):
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 Date: 05/30/2006
Resolution:
Other Sanctions Ordered:
Sanction Details: A FINE IN THE AMOUNT OF $17,500.00
Sanctions Ordered: CensureMonetary/Fine $17,500.00
Acceptance, Waiver & Consent(AWC)
Disclosure 10 of 11
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Reporting Source: Firm
Initiated By: STATE OF IDAHO, DEPARTMENT OF FINANCE, SECURITIES BUREAU
Date Initiated: 06/07/2004
Docket/Case Number: DOCKET NO. 2002-7-17
Principal Product Type: Equity Listed (Common & Preferred Stock)
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)
Current Status: Final
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Principal Sanction(s)/ReliefSought:
Civil and Administrative Penalt(ies) /Fine(s)
Other Sanction(s)/ReliefSought:
IN THE ORDER, MULTI-FINANCIAL AGREED TO OFFER RESCISSION TO 4INVESTORS IN EXCHANGE FOR TENDER OF THEIR EAG SHARES.
Principal Product Type: Equity Listed (Common & Preferred Stock)
Other Product Type(s):
Resolution Date: 06/07/2004
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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Reporting Source: Regulator
Initiated By: TEXAS STATE SECURITIES BOARD
Principal Sanction(s)/ReliefSought:
Other Sanction(s)/ReliefSought:
Date Initiated: 02/05/1997
Docket/Case Number: CEN/FIN-1165
URL for Regulatory Action:
Principal Product Type:
Other Product Type(s):
Allegations: Not Provided
Current Status: Final
Resolution Date: 02/05/1997
Resolution:
Sanctions Ordered: Monetary/Fine $5,000.00
Order
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Other Sanctions Ordered:
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
Sanctions Ordered: Monetary/Fine $5,000.00
iReporting Source: Firm
Initiated By: STATE OF TEXAS
Principal Sanction(s)/ReliefSought:
Other
Other Sanction(s)/ReliefSought:
CONSENT ORDER TO PROPERLY REGISTER ALL BRANCH OFFICES IN THEFUTURE; FINE OF $5,000
Date Initiated: 11/26/1996
Docket/Case Number: N/A
Principal Product Type: No Product
Other Product Type(s):
Allegations: REGISTERED BRANCH OFFICE IN STATE OF TEXAS AFTER OPERATIONSBEGAN
Current Status: Final
Resolution Date: 01/29/1997
Resolution:
Other Sanctions Ordered:
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.
Sanctions Ordered: Monetary/Fine $5,000.00
Consent
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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
Reporting Source: Regulator
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
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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
Principal Product Type: Other
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.
iReporting Source: Firm
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
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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.
49©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
www.finra.org/brokercheck User Guidance
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
Principal Product Type: Other
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.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.
50©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
www.finra.org/brokercheck User Guidance
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
Reporting Source: Regulator
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
i
Reporting Source: Regulator
Type of Event: ARBITRATION
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
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Disputed Product Type:
Sum of All Relief Requested:
Disposition:
Disposition Date:
Sum of All Relief Awarded:
ANNUITIES; DO NOT USE-NO OTHER TYPE OF SEC INVOLVE
$311,932.90
AWARD AGAINST PARTY
12/23/2005
$125,000.02
There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.
Disclosure 3 of 7
i
Reporting Source: Regulator
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
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
There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.
Disclosure 4 of 7
i
Reporting Source: Regulator
Type of Event: ARBITRATION
Arbitration Forum:
Allegations:
FINRA
ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-OMISSION OF FACTS; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNTRELATED-NEGLIGENCE
52©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
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Arbitration Forum:
Case Initiated:
Case Number:
Disputed Product Type:
Sum of All Relief Requested:
Disposition:
Disposition Date:
Sum of All Relief Awarded:
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
There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.
Disclosure 5 of 7
i
Reporting Source: Regulator
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:
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
There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.
Disclosure 6 of 7
i
53©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
www.finra.org/brokercheck User Guidance
Reporting Source: Regulator
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:
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
There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.
Disclosure 7 of 7
i
Reporting Source: Regulator
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
11/02/1994
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
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Sum of All Relief Awarded: $66,812.17
There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.
55©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC
www.finra.org/brokercheck User Guidance
End of Report
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56©2020 FINRA. All rights reserved. Report about CETERA ADVISORS LLC