You are here
Charles Schwab says it settled SEC suit on reporting failure
[SAN FRANCISCO] Charles Schwab said it settled a lawsuit with the Securities and Exchange Commission over claims the company failed to file reports on suspicious transactions by independent investment advisers that Schwab terminated from its platform.
The lawsuit, filed Monday in San Francisco federal court, claims Schwab's adviser services division failed to file suspicious activity reports, or SARs, in 2012 and 2013. The advisers are independent and contract with Schwab and provide investment advice, according to the complaint. They aren't employees of Schwab or affiliated with the financial-services firm.
Mayura Hooper, a spokeswoman for San Francisco-based Schwab, said the company settled with the SEC without providing terms.
"We appreciate the SEC completing its review of this matter and look forward to putting it behind us," Ms Hooper said in an emailed statement.
Chris Carofine, a spokesman for the SEC, couldn't immediately comment.
In those two years, Schwab terminated its business relationship with 83 advisers, with a combined total of US$1.62 billion in assets under management and almost 18,000 accounts, according to the complaint.
Schwab concluded they had violated its internal policies and presented risk to the firm. At least 47 of those engaged in transactions that Schwab had reason to suspect were suspicious, the SEC said in the complaint.