
By Buddy Doyle
Subscribe to our original industry insightsOn April 12, the SEC announced its Share Class Selection Disclosure Initiative (SCSD Initiative). Under the SCSD Initiative, “the Enforcement Division will recommend standardized, favorable settlement terms to investment advisers that self-report that they failed to disclose conflicts of interest associated with the receipt of 12b-1 fees by the adviser, its affiliates, or its supervised persons for investing advisory clients in a 12b-1 fee paying share class when a lower-cost share class of the same mutual fund was available for the advisory clients.” This initiative comes after a series of enforcement actions against RIAs over the past few years related to disclosures and share class selection processes. Investment Advisors have until June 12, 2018 to notify the SEC’s Division of Enforcement the intent to self-report.
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