On October 13, 2022, the Securities and Exchange Commission obtained a final judgment against defendants Cetera Advisors, LLC and Cetera Advisor Networks, LLC, whom the SEC previously charged with defrauding their advisory clients by failing to disclose several sources of compensation.
According to the SEC’s amended complaint filed on October 11, 2019, in the United States District Court for the District of Colorado, the Cetera defendants breached their fiduciary duty and defrauded retail advisory clients by, among other things, failing to properly disclose conflicts of interest related to the firms’ receipt of compensation in the form of 12b-1 fees, revenue sharing, administrative fees, and mark-ups.
The Cetera entities consented to entry of a final judgment permanently enjoining each of them from violations of Sections 206(2) and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-7 thereunder; ordering them to pay disgorgement on a joint and several basis of $5,614,509, plus prejudgment interest of $990,961; and ordering each of them to pay a $1,000,000 civil money penalty. The final judgment resolves all of the SEC’s claims asserted in the district court litigation.
SEC (Securities and Exchange Commission) lawyers specialize in navigating the complex regulatory landscape of securities law in the United States. These legal professionals play a crucial role in ensuring that companies comply with federal securities regulations, which are designed to protect investors and maintain the integrity of financial markets.
An SEC lawyer’s responsibilities include advising clients on matters related to securities offerings, mergers and acquisitions, corporate governance, and compliance with SEC rules. They also represent clients in investigations and enforcement actions brought by the SEC, where they defend against allegations of securities fraud, insider trading, and other violations.
Due to the high stakes involved, SEC lawyers must possess a deep understanding of financial regulations, as well as the ability to analyze and interpret complex legal documents. They often work with corporations, financial institutions, investment advisers, and public companies to ensure that all transactions and disclosures are in line with SEC requirements.
In addition to their advisory role, SEC lawyers are also involved in litigation, representing clients in court or in administrative proceedings. Their expertise is critical in helping businesses avoid costly penalties and reputational damage, making them indispensable in the financial and corporate sectors.