FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors.
Raymond James announces the company, not the advisors, will pay clawbacks (Financial Planning)
Raymond James is letting its advisors off the hook after previously announcing they would be personally responsible for paying rebates to clients who were wrongly sold expensive funds since 2010.
The news provides relief to advisors who were said to be on the hook for up to $US10.5 million. A Raymond James spokesperson commented, “This is a unique situation for the industry and for Raymond James, so we are expediting the reimbursement process and supporting our advisors while doing the right thing for their clients.”
Merrill Lynch landed a counter-punch against rival Morgan Stanley when it poached a nine-person team led by industry veteran Bruce Munster. The group oversees $US1.2 billion in assets and accounted for nearly $US6 million in annual revenues. According to Investment News, “It’s a win for a firm that began the year with the loss of a $US6.5 billion private banking team to Morgan Stanley after losing advisers managing a total of $US18.6 billion last year.”
Why it’s beneficial to get an early start on your taxes (Charles Schwab)
Charles Schwab notes there a number of reasons to get an early start on your taxes. Some of the reasons they finger are the ability to find out soon if you are due a refund, knowing if you can make tax deductible IRA contributions, allowing time to get a social security number for a new family member, and having time to correct any errors. Getting an early start on your taxes also allows more time to make sure you do not overlook any deductions.
FBI opens investigation into fraudulent tax filings (Wall Street Journal)
The Federal Bureau of Investigation has launched a probe into the possibility a data breach was responsible for fraudulent tax returns being filed in approximately 19 states. Turbo Tax parent Intuit pushed back against the possibility of a data breach, and that sentiment seemed to be reiterated by officials at competitors H&R Block and TaxAct. “As we have for many years, we are working with both states and the IRS to combat this evolving threat to taxpayers,” noted Julie Miller, an Intuit spokeswoman.
RIA barred after falsely claiming to be ‘SEC approved’ (Financial Planning)
John A Geringer of California-based GLR Advisors and GLR Capital Management was barred by the SEC after investing client money in GLR Growth Fund, what he claimed was an ‘SEC approved’ fund which generated 17-25% returns every year since its inception in 2005. In reality, Mr. Geringer parked investor money in two ‘illiquid investments’ and used the remainder of the cash to pay back other investors. According to the SEC, “to the extent Geringer engaged in actual securities trading, far from generating high annual returns, he consistently lost money.”
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