Three Major Firms Must Repay $8.2M for Missed Mutual Fund Fee Waivers

When financial firms promise to look after your investments, they're expected to catch every opportunity to save you money. But sometimes even the biggest players drop the ball. That's exactly what happened at Edward Jones, Osaic Wealth, and Cambridge Investment Research, where a FINRA investigation revealed they had collectively overlooked millions in potential savings for their clients. The financial industry watchdog has now ordered these firms to pay back more than $8.2 million to customers who missed out on fee waivers and rebates they should have received.

The story begins with something called a "right of reinstatement" - think of it as a VIP pass that lets investors buy back into mutual funds they've previously sold without paying the usual entry fees. It's a valuable benefit that can save investors significant money, but only if their financial firms are paying attention.

FINRA's investigation, which kicked off in 2020, found that none of these firms had proper systems in place to catch these opportunities. The price tag for this oversight? Edward Jones clients paid $4,440,979 too much in fees, Osaic Wealth customers were overcharged by $3,096,490, and Cambridge Investment Research clients paid an excess of $699,217.

"Obtaining restitution for harmed customers is a top priority," said Bill St. Louis, FINRA's Head of Enforcement, emphasizing that firms must ensure clients receive all fee waivers and rebates they're entitled to.

There is a silver lining to this story. Once caught, all three firms jumped into action - bringing in outside experts to identify affected customers, reviewing their systems top to bottom, and setting up plans to repay every penny with interest. This cooperative approach led FINRA to skip additional fines, though each firm received a censure.

This case, which brings FINRA's total recovered mutual fund overcharges to $9.5 million across five firms, serves as a reminder that even as the financial world grows more complex, the basics still matter: every dollar counts, and it's the firm's job to make sure you're not paying more than you should.

While the firms neither admitted nor denied the findings in settling these matters, the message is clear - in today's financial marketplace, oversight isn't just about catching wrongdoing; it's about making sure clients receive every benefit they're due.

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