Defendant Name: Principal Securities, Inc.

Defendant Type: Subsidiary of Public Company
Public Company Parent: Principal Financial Group, Inc.
SIC Code: 6321
CUSIP: 74251V10

Initial Case Details

Legal Case Name In the Matter of Principal Securities, Inc.
First Document Date 11-Mar-2019
Initial Filing Format Administrative Action
File Number 3-19057
Allegation Type Investment Advisers/Investment Companies

Violations Alleged

Other
• Sections 206(2), 207 Advisers Act

Resolutions

First Resolution Date 11-Mar-2019
Headline Total Penalty and Disgorgement $1,764,624

Related Documents:

IA-5154 11-Mar-2019 Administrative Proceeding
Order Instituting Administrative and Cease-And-Desist Proceedings, Pursuant to Sections 203(e) and 203(k) of the Investment Advisers Act of 1940, Making Findings, and Imposing Remedial Sanctions and a Cease-And-Desist Order
The Commission stated: "These proceedings arise out of breaches of fiduciary duty and inadequate disclosures by registered investment adviser Principal Securities, Inc. in connection with its mutual fund share class selection practices and the fees it and associated persons received pursuant to Rule 12b-1 under the Investment Company Act of 1940 ("12b-1 fees")."
2019-28_3-19057 11-Mar-2019 Press Release--Administrative Proceeding
SEC Share Class Initiative Returning More Than $125 Million to Investors
On March 11, 2019, the SEC "announced settled charges against 79 investment advisers who will return more than $125 million to clients, with a substantial majority of the funds going to retail investors. The actions stem from the SEC's Share Class Selection Disclosure Initiative , which the SEC's Division of Enforcement announced in February 2018 in an effort to identify and promptly correct ongoing harm in the sale of mutual fund shares by investment advisers. The initiative incentivized investment advisers to self-report violations of the Advisers Act resulting from undisclosed conflicts of interest, promptly compensate investors, and review and correct fee disclosures. The orders issued today address advisers who directly or indirectly received 12b-1 fees for investments selected for their clients without adequate disclosure, including disclosures that were inconsistent with the advisers' actual practices."