There are 37 total disclosures on this firm’s record, according to its BrokerCheck record, accessed March 10, 2023. Investors should keep reading to learn more about the most recent disclosures. You can read a complete list of their disclosures in their detailed BrokerCheck record.
Allegations of FINRA Rule Violations
According to an Acceptance, Waiver, and Consent agreement dated October 19, 2021, Equitable Advisors consented to the findings that it executed a settlement agreement that violated FINRA Rules. Allegedly, a broker added to the settlement an agreement that the customer would not oppose the broker’s request to expunge the dispute from their record.
Brokers may request that FINRA expunge a customer dispute, but FINRA Rule 2081 states that firms are not to include these types of conditions in their settlement agreements with customers.
The AWC alleges that Equitable Advisors should have detected this language and removed that provision before the customer signed.
As part of the terms of the AWC, Equitable Advisors consented to a $20,000 fine.
Allegations of Misrepresentation Concerning 401(k)s
On May 2, 2019, Equitable Advisors consented to the findings in an AWC alleging that forms created by the firm’s affiliated life insurance company contained misleading information concerning their 401(k)s. The forms allegedly misrepresented certain bonds funds as investment grade, when FINRA alleges they were not. Non-investment grade bonds can be highly risky investments, unlike traditional bonds. Further, the AWC alleged that Equitable Advisors did not conduct periodic reviews of fund classifications to ensure that their credit quality was described accurately.
Equitable Advisors consented to a $600,000 fine in addition to a restitution payment of $172,461.33 to be paid to customers.
Mutual Fund Fee Allegations
According to an Order issued by the Securities and Exchange Commission dated March 11, 2019, Equitable Advisors (a.k.a. AXA Advisors LLC), failed to make adequate disclosures regarding its mutual funds. Allegedly, the firm’s advisors recommended or held mutual fund share classes that charged 12b-1 fees instead of lower-cost share classes.
Equitable Advisors allegedly failed to disclose the conflicts of interest related to mutual funds that charge 12b-1 fees. 12b-1 fees are also known as the mutual fund’s expense ratio. These fees cover the mutual fund’s expenses. Brokers should always recommend lower-cost shares classes if they are available.
Equitable Advisors consented to pay a disgorgement of $972,007.36 and a prejudgment interest of $162,144.64.
Florida Annuity Allegations
On August 8, 2018, AXA Advisors entered into a stipulation and consent agreement alleging the firm failed to supervise brokers. Firms are required to supervise brokers under FINRA Rule 3110. AXA advisors allegedly recommended annuities without having a basis for believing they would suit investor needs. Furthermore, the firm allegedly approved annuity applications that were not correct.
As part of the agreement, the firm consented to pay a fine of $50,000.
