According to FINRA, Osaic Wealth, Inc. and its affiliated broker-dealers were ordered to pay $3,096,490 in restitution to customers who were harmed by the firm's failure to provide available mutual fund sales charge waivers and fee rebates.

Many mutual fund issuers offer a right of reinstatement, which allows investors to reinvest in shares of a fund or fund family after previously selling shares without incurring a front-end sales charge, or to recoup all or part of a contingent deferred sales charge.

FINRA found that Osaic Wealth failed to establish and maintain a supervisory system reasonably designed to supervise whether eligible customers received these benefits. As a result, customers paid excess sales charges and fees.

No fine was imposed in recognition of the firm's extraordinary cooperation with FINRA's investigation. The firm voluntarily initiated an extensive review of its systems, engaged an outside consultant to identify affected customers and calculate restitution, and established a plan to efficiently identify, notify, and repay eligible customers.

This case is part of a FINRA targeted examination initiated in 2020 that has secured over $9.5 million in restitution for affected mutual fund customers across five firms.

Investors should understand the fee waivers and rebates available to them when investing in mutual funds. Rights of reinstatement can provide significant savings when reinvesting in funds previously owned.