Fitapelli Kurta is investigating complaints against PNC Investments in connection with the sale of speculative ETFs and UITs. The Financial Industry Regulatory Authority (“FINRA”) recently fined PNC Investments LLC $90,000.00 for complaints that PNC failed to apply an appropriate rollover or breakpoint discount to customers who purchased unit investment trusts (“UIT”). According to FINRA, PNC also failed to adequately enforce its existing Written Supervisory Procedures concerning rollover and breakpoint sales charge discounts to ensure that that the firm’s customers received the appropriate discounts when eligible.
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FINRA also fined PNC $275,000 and ordered the firm to pay $33,183.72, plus interest, in restitution to its customers for recommended highly speculative inverse and inverse-leveraged ETFs (non-traditional ETFs) to its customers. The PNC consented to the findings in FINRA’s complaint that it failed to establish and maintain an appropriate supervisory system, including written procedures, reasonably designed to achieve compliance with FINRA rules in connection with ETFs. The findings stated that non-traditional ETFs have certain risks that are not found in traditional ETFs. Despite these differences in the products, FINRA found that PNC Investments supervised non-traditional ETFs the same way it supervised traditional ETFs, which was not sufficiently tailored to address the various risks associated with non-traditional ETFs. The complaint also stated that PNC Investments failed to provide adequate formal training to its stockbrokers and their supervisors regarding the features, risks and characteristics of non-traditional ETFs. The firm allowed certain of its registered representatives to recommend to customers a non-traditional ETF without performing reasonable diligence to understand the risks and features associated with it.
If you have a complaint or potential lawsuit against PNC Investments LLC please contact the lawyers at Fitapelli Kurta. We will provide a free consultation and will help you determine if there is an avenue for you to recover your losses.