Raymond James Hit With $4.2M Fine Over High Fees

A group of state regulators has ordered Raymond James Financial Services Inc. to return $8.25 million, plus interest, to customers who were charged unreasonably high fees over the past five years.

The order, to which the firm has consented, further demands that Raymond James pay a total of $4.2 million in fines and penalties to the states involved, according to a press release issued by Massachusetts secretary of state William Galvin, the state’s top securities regulator.

According to the settlement agreement secured by Galvin’s office, Raymond James overcharged customers by applying a $75 minimum commission charge, regardless of the reasonableness of the commission. Because the broker-dealer failed to have appropriate systems in place to stop overcharging of customers, many paid over 90% of the principal amount, according to the regulators.

The order was pursued in coordination with a North American Securities Administrators Association working group that included financial regulators in Alabama, California, Illinois, Montana and Washington, while Galvin’s Massachusetts Securities Division led the investigation looking into Raymond James’ brokerage fee practices.