Texas State Securities Board Fines Charles Schwab & Co. $95,000

Texas State Securities Board Fines Charles Schwab & Co. $95,000

Texas State Securities Board Fines Charles Schwab & Co. $95,000 150 150 Robert Rex, Esq.


September 2016- Austin, Texas

Charles Schwab & Co. entered into a Consent Order with the Texas State Securities Board (TSSB) and agreed to pay an administrative fine of $95,000 as well as a contribution of $30,000 to be used for education efforts in Texas to the Investors Education Fund of the Investor Protection Trust.

In the Consent Order, TSSB concluded that Charles Schwab & Co. failed to maintain and establish a supervisory system reasonably designed to achieve compliance with the Texas securities laws, in violation of TSSB rules and regulations.

The order followed an investigation by the staff of the State Securities Board into Schwab’s procedures for monitoring the registration status of persons authorized by clients as a limited power of attorney or full power of attorney (POA). Staff investigated Schwab’s procedures from January 2010 to January 2016.

Schwab requires persons authorized as a limited or full POA to state whether they are receiving compensation for any investment advice rendered to clients. Receiving compensation for advisory services may require registration under state and federal law unless the person with a POA is covered by an exemption from registration.

According to the order, Schwab identified certain persons who had power of attorney authorizations in Texas and who appeared to be rendering investment advice for compensation, but were not registered and did not qualify for an exemption from registration.

Rex Securities Law , with offices in Boca Raton, FL,  and  Austin, TX,   provides representation to  investors  nationwide who are seeking recovery of investment losses due to the negligence or fraud of stockbrokers and broker dealers. If you have questions about how your account has been handled, call to speak with an experienced securities attorney.

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