SALT LAKE CITY–The Utah Division of Securities last month moved to fine three large independent broker-dealers for how they do business with credit unions.
Assessed a combined $2.25 million in fines for rules violations were Cetera Advisor Networks, LPL Financial and CUSO Financial Services, according to Investment News. In each case the companies had representatives inside credit union offices.
“According to each of the three Utah petitions to censure and fine, the Utah Division of Securities found the broker-dealers ‘failed to comply with the regulatory requirements governing networking arrangements between broker-dealers and credit unions, and approved the use of misleading sales and advertising materials and other information provided to customers and the public’,” Investment News reported.
The outline for proper networking agreements dates back to 1993, according to the Utah petitions, and broker-dealers are responsible for all materials used to advertise or promote investment services, the publication added.
LPL Financial Fined
As CUToday.info reported, in 2017 LPL Financial was fined $1 million by the Massachusetts Securities Division for failing to supervise its financial advisers who operated out of the Digital Federal Credit Union.
Investment News reported the state of Utah is looking to fine Cetera Advisor Networks $1 million, LPL $750,000 and CUSO $500,000.
"We disagree with the allegations made in the Utah division of securities petition and have begun the process of vigorously defending ourselves in this matter," Peter Vonk, chief compliance officer at CUSO Financial Services, was quoted as saying.