JACKSON, Miss. – Secretary of State Michael Watson and the Mississippi Secretary of State’s Securities Division, a member of the North American Securities Administrators Association (NASAA), have joined a multi-state, multimillion-dollar settlement following an investigation into five investment firms.

Conducted by state securities regulators, the investigation determined Edward Jones, LPL Financial, RBC, Stifel, and TD Ameritrade have charged unreasonable commissions to retail customers on small dollar transactions. Over a five-year period, data reveals these firms have charged approximately $19 million to process 1.12 million small dollar equity transactions and trades.

State securities laws strongly prohibit firms from charging unreasonable commissions to their customers. When determining excessive fees, regulators must consider several factors, including guidance provided by the brokerage industry’s self-regulatory organization, FINRA. Pursuant to FINRA Rule 2121, a commission pattern of 5% or less may be considered unfair or unreasonable. In this investigation, numerous equity transactions executed by the five firms included commissions well in excess of 5% of the transaction’s principal value.

As a result of the investigation and settlement terms, the firms have agreed to provide affected customers with restitution, plus interest in the amount of 6% from the date of the customer’s transaction through the date of execution of the Term Sheet and Offer of Settlement. Fines and costs will also be assessed. The firms will pay total fines not to exceed $9.345 million to settling states, in addition to reimbursement of investigative costs to the states in the working group. Each firm must also take measures to ensure its policies and procedures include safeguards to prevent charging excessive fees.

"Through the diligent and persistent work of Eric Slee and our Securities Division, Mississippi investors may have confidence their hard-earned dollars are safe. Companies operating in Mississippi will be held accountable and required to follow the law," said Secretary Michael Watson.

For additional information or questions, please contact the Securities Division at Securities.customerservice@sos.ms.gov or (601) 359-1334. Investors living in states other than Mississippi, or in provinces, can contact their local regulator agency.