However, at various times since at least January 2006, Merrill Lynch did not waive the sales charges
for affected customers when it offered class A shares.
The Notice reminds broker-dealers that they should develop and implement procedures to ensure customers receive appropriate sales charge
discounts for UITs.
True "no-load" funds will not have sales charges
or 12b-1 fees.
5 February 2014 -- Canadian financial services firm Manulife Financial's (TSX: MFC) (NYSE: MFC) John Hancock Investments unit said it is reducing sales charges
for class A shares on 16 fixed-income funds, including the elimination of the front-end sales charges
on the John Hancock Floating Rate Income Fund (class A: JFIAX) and the John Hancock Short Duration Credit Opportunities Fund (class A: JMBAX) for investments of USD 250,000 or more.
Among recent enforcement actions by the Financial Industry Regulatory Authority were the censure and fine of two firms for failing to appropriately discount sales charges
of unit investment trusts.
failed to waive mutual fund sales charges
for eligible charitable organizations and retirement accounts.
Under these programs, customers who redeemed fund shares for which they had paid a sales charge
were permitted to use the proceeds to purchase Class A shares of a new mutual fund at NAV - that is, without paying another sales charge
Wells Fargo Advisors, Wells Fargo Advisors Financial Network (FiNet), Raymond James & Associates, Raymond James Financial Services and LPL Financial agreed Monday to pay more than $30 million in restitution, including interest, to affected customers for failing to waive mutual fund sales charges
for certain charitable and retirement accounts.
Policies regarding Rights of Accumulation, Sales Charge
Waivers, Contingent Deferred Sales Charges
and 12b-1 fees.
FINRA found that Banorte Securities International recommended Class B shares of off-shore mutual funds to its customers in certain transactions where the customers would have financially benefited from purchasing Class A shares - particularly since the firm had negotiated lower front-end sales charges
for off-shore mutual fund Class A shares with several mutual fund companies.
The supervisory problems here led not only to the sales of inappropriate mutual fund share classes, but to the failure to identify special sales charge
waiver programs on mutual fund purchases.
Withdrawal of tax-deferred accumulations may be subject to deferred sales charges
and are subject to ordinary income tax.