FINRA Fines American Portfolios $1.6M, Alleging UIT Lapses
Action Required: Review current firm policies and automated surveillance systems regarding UIT trading and fee generation to ensure compliance with Reg BI and suitability standards.
FINRA has fined American Portfolios $1.6 million due to representatives repeatedly recommending the early sale and replacement of unit investment trusts (UITs), which generated unnecessary fees for clients. This serves as a reminder of the regulatory scrutiny surrounding 'churning' and the importance of ensuring that product recommendations are in the client's best interest.
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