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Soreide Law Group, based in Pompano Beach, Florida, obtained the following information from FINRA’s June 2017 Disciplinary Report on South Florida firm:
Legend Equities Corporation (CRD #30999, Palm Beach Gardens, Florida)
was censured and required to provide FINRA with a plan to remediate eligible clients who qualified for, but did not receive, the applicable mutual fund sales-charge waiver. As part of this settlement, Legend Equities agrees to pay restitution to eligible clients, which is estimated to total $2,300,188 (the amount eligible clients were overcharged, inclusive of interest). According to the FINRA report, Legend Equities will also ensure that retirement and charitable waivers are appropriately applied to all future transactions.
Without admitting or denying the findings, Legend Equities consented to the sanctions and to the entry of findings that it disadvantaged certain retirement plan and charitable organization clients that were eligible to purchase Class A shares in certain mutual funds without a front-end sales charge.
FINRA’s findings stated that these eligible clients were instead sold Class A shares with a front-end sales charge or Class B or C shares with back-end sales charges and higher ongoing fees and expenses. These sales disadvantaged eligible clients by causing clients to pay higher fees than they were actually required to pay.
Also, FINRA’s findings stated that Legend Equities failed to reasonably supervise the application of sales-charge waivers to eligible mutual fund sales. The firm relied on its financial advisors to determine the applicability of sales-charge waivers, but failed to maintain adequate written policies or procedures to assist financial advisors in making this determination.
FINRA stated that the firm failed to adequately notify and train its financial advisors regarding the availability of mutual fund sales-charge waivers for eligible clients. Legend Equities also failed to adopt adequate controls to detect instances in which they did not provide sales-charge waivers to eligible clients in connection with their mutual fund purchases. As a result of the firm’s failure to apply available sales-charge waivers, the firm estimates that eligible clients were overcharged by approximately $2,080,690 for mutual fund purchases made since July 1, 2009.
(FINRA Case #2016050259801)
If you were a client of Palm Beach Garden’s Legend Equities Corporation, and experienced losses due to their actions or recommendations, call Soreide Law Group, conveniently located in South Florida, for a no-cost consultation with a securities lawyer regarding the possible recovery of you investment losses at: 888-760-6552.
Soreide Law Group represents clients nationally before FINRA on a contingency fee basis. Let our years of experience work for you.
