Cambridge Investment Research Agreed to $250K Fine to Settle FINRA Charges

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In May 2015, Cambridge Investment Research, Inc. signed a letter of Acceptance, Waiver and Consent with the Financial Industry Regulatory Authority (FINRA) to settle charges that the firm charged purchasers of unit investment trusts (UIT) excessive sales fees totaling $423,774.27.

Specifically, FINRA determined that the excess fees resulted from Cambridge failing to credit its customers for “rollover” and exchange discounts in connection with eligible purchases of unit investment trusts (UIT).  Although FINRA found that Cambridge did reimburse the affected customers, it found that the firm’s relevant controls were deficient.

Cambridge primarily relied on its registered representatives to credit customers with appropriate UIT sales charge discounts, yet the firm’s representatives and supervisors were not properly trained to identify and apply such sales charge discounts.

Cambridge did not admit or deny the FINRA findings, but agreed to pay a $250,000 to FINRA to resolve the allegations.

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