Published On: February 26, 2016

The Financial Industry Regulatory Authority (FINRA) ordered Louisville-based money management firm Hilliard Lyons, to pay more than $500,000 as part of a financial industry fine and repayment plan to bilked investors. It will pay $175,000 and refund $328,491 to customers who were billed for excessive sales charges between 2009 and 2014. The firm agreed earlier this month to the findings and punishment in a Letter of Acceptance, Waiver and Consent (AWC). In it, they were accused of “failing to apply sales charge discounts” toward the purchase of so-called unit investment trusts (UITs) by an unspecified number of buyers. FINRA stated that mostly discounts are applied when investors do “rollovers” or “exchanges” within their trusts. UITs consist of a relatively fixed portfolio of securities deposited in a trust and sold in units to the public. They typically contain stocks and bonds and generate capital appreciation or dividend income, or both, over a specified term. Four months ago, the U.S. Securities and Exchange Commission (SEC) fined the firm $420,000 for “offering and selling municipal securities on the basis of materially misleading disclosure documents.”

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