From a massive continuing education cheating scandal, to LPL Financial's lawsuit and other challenges, here are some of the top news items that swept across the wealth management landscape in 2024.
Lawsuit calls Carson Group's succession into question
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One of the industry's messiest CEO changes in recent memory is testing whether a rapidly growing firm can maintain its influential position and trajectory under multiple kinds of pressure.
In April, Omaha, Nebraska-based
The
Advisor's suit accuses LPL of raiding $450M book of business
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Mark Lamkin says everything had gone well for years while his independent firm managed roughly $450 million through an affiliation with LPL Financial.
Then came his discovery that a pair of his associates were placing clients in allegedly unsuitable private investments. That set in motion a series of events eventually leading to the
Might the Social Security Fairness Act still pass this year?
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Like many Americans, Congress has a habit of not thinking about retirement until the last minute. This year, in the final days of 2024, the Senate is weighing whether to pass the Social Security Fairness Act.
The bill has been around for a long time. In its current form, the SSFA was introduced in January 2023. But even before that, versions of the legislation have been proposed since the early 1980s — the last time Congress enacted major reforms to Social Security. In November 2024, the bill finally passed the House of Representatives, leaving its fate up to the Senate.
What's in the bill? The SSFA would repeal two pieces of the Reagan-era reforms: the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). Designed to shore up Social Security's finances, both measures cut benefits for certain retirees — without justification, according to critics.
63 brokers suspended, 4 banned in CE cheating scheme
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A continuing education cheating scheme has landed at least 63 brokers suspensions and fines from the Financial Industry Regulatory Authority. Four brokers have been barred from the industry for refusing to cooperate with the investigation.
The disciplined brokers certified to the state of New York that they had completed 15 hours of continuing education to maintain their state insurance licenses when, in fact, someone else completed the requirements for them. All 63 brokers received a one-month suspension and a $5,000 fine.
It's possible that more brokers will be disciplined, but FINRA officials would not comment on whether any current investigations are ongoing. The alleged infractions date back to 2022.
DOL retirement advice rule in limbo ahead of election
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As financial advisors and other wealth management professionals brace for a new presidential administration next year, the Department of Labor's retirement advice rule is stymied in court.
Labor is appealing a stay in the regulation's implementation under industry lawsuits challenging the "retirement security rule," but the venue looks anything but receptive in an appeals court that overturned the last Democratic administration's attempt to expand the fiduciary duty to more 401(k) rollovers and certain annuity sales.
Regardless of how that case turns out, advocates for tougher consumer protections in advice to retirement savers could pursue their own lawsuits testing the existing standards over so-called prohibited transaction exemptions, according to Chris Tobe, a
Merrill loses $1.6B team to UBS amid exodus of firm lifers
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For the second time in just over a week,
The Swiss banking giant,
Ten days before, on Jan. 12, UBS announced it had brought over
Drama in LPL's house: What big OSJ besides Merit is leaving?
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The unexpected announcement that two branches with a combined $20 billion in client assets
Which offices of supervisory jurisdiction will be gone? LPL didn't reveal their identities at the time. A few days later, Merit Financial Advisors
Hundreds
$72M Commonwealth judgment hammers home firms' disclosure duties
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A more than $70 million judgment imposed on
Louis Straney, a regulatory expert at
The penalty comes as the culmination of the SEC's years-long fight to prove that Commonwealth had failed to
Schwab, crypto, alleged fraud and an elderly couple's $18.5M loss
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Charles Schwab may have a big elder fraud problem on its hands.
For the third time in less than two months, Schwab and its affiliates have been accused of doing virtually nothing to prevent scammers from draining its clients' accounts of their retirement savings. The latest case, filed in October in federal district court in Northern California, alleges Schwab stood idly by while bad actors directed an elderly Los Angeles County couple to take nearly $30 million out of their accounts and transfer much of it to a cryptocurrency exchange via
Ultimately, $18.5 million of that was converted into crypto and sent to the scammers, making it likely unrecoverable, according to the suit.
Not just AUM: Edward Jones embraces financial planning for a flat fee
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Edward Jones is becoming a pioneer among large wealth managers with a business model allowing its advisors to offer a comprehensive financial plan in return for a flat, annual fee.
The St. Louis-based firm announced in October that roughly 600 of its advisors will be able to start providing certain clients with comprehensive financial plans for $3,600 a year. The services will go beyond the usual investment recommendations paid for by asset management charges and extend to estate and tax planning, wealth transfers, protections against risk and advice on general life goals.
"For the first time, Edward Jones financial advisors will be able to deliver comprehensive financial planning and will be compensated accordingly for their time and effort to build and maintain a financial plan,"
