The Financial Industry Regulatory Authority (“FINRA”) has accepted a letter of Acceptance, Waiver, and Consent from Questar Capital Corporation, of Minneapolis, Minnesota, for its failure to identify and apply sales charge waivers to eligible retirement accounts and charitable organizations.
Without admitting or denying any findings made against it, Questar accepted a censure from FINRA and agreed to pay restitution to eligible customers an estimated $796,892. According to FINRA’s findings, Questar sold mutual funds to certain retirement plans and/or charitable organizations which were eligible for up-front waivers of sales charges associated with the funds’ Class A shares. Questar failed to apply the waivers to mutual fund purchases made by the eligible customers and instead sold them Class A shares with the higher fees and expenses associated with Class B or C shares.
FINRA further found that Questar failed to reasonably supervise the application of sales charge waivers to eligible mutual fund sales. Specifically, Questar failed to maintain adequate written policies or procedures to assist its financial advisors in determining whether sales charge waivers were applicable. Questar further failed to adequately notify and train its advisors regarding the availability of mutual fund sales charge waivers and failed to adopt adequate controls to detect instances where sales charge waivers were not provided to eligible customers.
If you or someone you know maintained a retirement account or was a charitable organization doing business with Questar and paid sales charges on a mutual fund investment, please call the Frankowski Firm at 888.741.7503 or fill out this contact form.