SoFi Securities

Kurta Law is investigating recommendations by SoFi Securities (CRD#: 151717) brokers. Investors should know that the firm has been fined by FINRA multiple times. The brokerage firm is an affiliate of SoFi Bank, N.A., and is based in San Francisco, California.

SoFi Securities has also operated as Bohica Securities.

Fees and Conflicts of Interest

In its Customer Relationship Summary (Form CRS), SoFi Securities discloses fees and conflicts of interest that investors should know about:

• While you won’t pay commissions on transactions, you will pay account services fees and regulatory and third-party fees passed on by SoFi Securities. Your trades are placed through Apex Clearing Corporation, SoFi Securities’ clearing firm.
• SoFi Securities receives a share of Apex Clearing Corporation’s revenue on stock lending, order routing revenue, interest on margin loans, cash sweep revenue, and fees.
• Investors will also pay management fees for certain investment products.
• ETFs and other funds charge an ongoing asset-based fee in the form of an operating expense ratio. This is a percentage of your investment in the fund. SoFi Securities also receives a portion of marketing/servicing fees from certain funds if you purchase the investment through the firm.
• SoFi Securities earns compensation from proprietary products and services offered or sponsored by affiliates.
• The firm earns interest on your uninvested cash and on cash in sweep accounts held at SoFi Bank and other banks.
• Apex Clearing Corporation pays SoFi Securities a portion of its order routing revenue earned from third-party market centers. This incentivizes the firm to direct your orders to these market centers, within best execution requirements.

Broker-Dealer Services

SoFi Securities offers self-directed brokerage services focused around facilitating securities transactions. It also offers access to potentially risky investments like exchange-traded funds (ETFs).

SoFi Securities’ IPO Center may also solicit investors for initial public offerings (IPOs). The firm also has a referral agreement with Templum Markets which allows eligible accredited investors to access certain special purpose investment vehicles and private investment funds.

Regulatory Actions

Kurta Law wants investors to be aware that SoFi Securities discloses the following regulatory actions on its detailed BrokerCheck page.

$1.1 Million FINRA Fine

On May 2, 2024, FINRA filed a Letter of Acceptance, Waiver & Consent (AWC) alleging that the firm failed to establish and maintain a reasonable Customer Identification Program (CIP) and Identity Theft Prevention Program (ITPP) for SoFi Money, its cash management brokerage account.

The AWC alleged that SoFi Securities used a mostly automated process to approve the opening of SoFi Money accounts, leaving it vulnerable to fraud by third parties using fictitious or stolen identities.

SoFi Money allegedly approved the opening of approximately 800 accounts later used by third parties to make unauthorized transfers of approximately $8.6 million from accounts of customers of other financial institutions, and then to withdraw approximately $2.5 million from their SoFi accounts.

SoFi Securities was fined $1.1 million and censured by FINRA. You can access the full AWC here.

Alleged Misrepresentations

On December 5, 2023, SoFi Securities consented to the entry of findings that it allegedly failed to establish and enforce a supervisory system, including Written Supervisory Procedures (WSPs), for its fully paid securities lending business.

According to an AWC, the firm distributed documents to more than 2 million retail investors containing misrepresentations related to the compensation investors would receive for participating in fully paid securities lending.

FINRA censured the firm, fined it $500,000, and ordered it to pay restitution of $198,282.39 plus interest. You can read the full AWC here.

How Can Investors Recover Lost Funds from a Brokerage Firm?

Brokerage firms often require investors to resolve disputes through FINRA arbitration, a quicker and cheaper alternative to civil court. A securities attorney can evaluate your case and help you file a dispute.

Kurta Law Can Help

Investors who lost money working with a SoFi Securities broker should reach out to an investment fraud lawyer for help. Our attorneys offer free case evaluations and do not charge a fee unless we win your case. Call (877) 600-0098 or email info@kurtalawfirm.com.