SEC orders these advisory firms, broker-dealers to return over $3 million to harmed investors


The firms’ offering documents indicated that these investment products are more likely to decline in value when held for a longer period.

The SEC found that the firms’ representatives recommended the volatility-linked exchange-traded products to investors and advised them to hold it for months or years.

Additionally, the firms allegedly failed to adopt or implement policies and procedures concerning the suitability and volatility-linked exchange-traded products.

In a statement, SEC Division of Enforcement Director Stephanie Avakian said, “It is important for firms to put the appropriate protections in place to ensure complex products are properly evaluated and understood by their representatives. Failing to do so, puts investors at risk. We take these failures seriously, and we will continue to look for sales that expose customers to unsuitable investments.”

SEC allegations and order against American Portfolios Financial Services (APFS)

The Commission accused APFS of failing to adequately supervise some of its brokerage representatives who offered investors to buy and hold volatility-linked exchange-traded products