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Attorney General Brown Settles Edward Jones Lawsuit
SACRAMENTO-California Attorney General Edmund G. Brown Jr. today announced a $7.5million settlement with financial-services firm Edward Jones & Co. for the company's failure to inform its customers of its revenue-sharing agreements with various mutual-fund companies. In these revenue-sharing agreements, Edward Jones obtained payments from mutual fund companies in exchange for promoting their mutual funds to its clients.
"Since we brought suit in 2004, Edward Jones has agreed to change its disclosure policies,' Attorney General Brown said. 'That settlement requires Edward Jones to notify each of its customers of any payments it receives from mutual funds that Edward Jones recommends. This will make for better-informed customer decisions.'
In 2004, Edward Jones made an agreement with federal, state and self-regulatory authorities to pay $75 million in refunds and civil penalties to its customers. Edward Jones also agreed to disclose all its revenue-sharing payments on its public website and to hire independent consultants to review and make recommendations regarding the company's disclosures.
The California Attorney General filed his own lawsuit against the company to enforce the state's consumer protection laws. In settlement of this case, Edward Jones will pay $7.5 million in civil penalties, fees and costs.
The settlement agreement is attached.