Investment News: Regulators bare their teeth on excessive fees

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Burr's Tom Potter was recently interviewed by Investment News on regulatory crackdown on overcharging clients.

A regulatory crackdown on overcharging clients was amplified this week with a move by FINRA against an investment company and by a response from an investment banker to Securities and Exchange Commission pressure.

The actions highlighted the emphasis that each regulator has put on ferreting out excessive fees, and could reverberate in the retail investment adviser sector. Both the Financial Industry Regulatory Authority Inc. and the SEC have made scrutiny of fees a regulatory and examination priority this year.

FINRA, the industry-funded broker-dealer regulator, levied a $350,000 fine against Fidelity Investments for what it said was inappropriately charging more than 20,000 clients a total of $2.4 million for certain transactions in fee-based accounts in its Institutional Wealth Services Group.

"Private equity firms have had to register with the SEC under a mandate in the Dodd-Frank financial reform law. They're now getting the same scrutiny on fees that investment advisers and brokers have experienced for years," said Tom Potter, a managing partner at Burr & Forman.

For full article from Investment News, click here.

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