Defendant Name:
Charles Schwab Investment Management
Defendant Type:
Subsidiary of Public Company
Public Company Parent:
Charles Schwab Corporation
SIC Code:
6211
CUSIP:
80851310
Initial Case Details
Legal Case Name
SEC v. Charles Schwab Investment Management, Inc.; Charles Schwab & Co., Inc; and Schwab Investments
First Document Date
11-Jan-2011
Initial Filing Format
Civil Proceeding
Case Number
11-cv-00136
Allegation Type
Securities Offering
Federal District Court
California, Northern District of California
Violations Alleged
•
Section 204A, 206(4) Investment Advisers Act; Rule 206(4)-8 Investment Advisers Act
Related Violations Alleged
Charles Schwab Investment Management is alleged to have aided and abetted an unidentified individual or entity's violation of Section 34(b) Investment Company Act (willfully/knowingly).
Charles Schwab Investment Management is alleged to have caused an unidentified individual or entity's violation of Section 34(b) Investment Company Act (willfully/knowingly).
Charles Schwab Investment Management is alleged to have aided and abetted
Schwab Investments's violation of Section 13(a), 34(b) Investment Company Act (willfully/knowingly).
Charles Schwab Investment Management is alleged to have caused
Schwab Investments's violation of Section 13(a), 34(b) Investment Company Act.
Resolutions
First Resolution Date
11-Jan-2011
Headline Total Penalty and Disgorgement
$118,944,996
Related Documents:
2011-7
11-Jan-2011
Press Release--Civil Action
SEC Charges Schwab Entities and Two Executives With Making Misleading Statements; Schwab Entities to Pay More Than $118 Million to Settle SEC Charges
On January 11, 2011, the SEC announced that it "charged Charles Schwab Investment Management (CSIM) and Charles Schwab & Co., Inc. (CS&Co.) with making misleading statements regarding the Schwab YieldPlus Fund and failing to establish, maintain and enforce policies and procedures to prevent the misuse of material, nonpublic information. The SEC also charged CSIM and Schwab Investments with deviating from the YieldPlus fund's concentration policy without obtaining the required shareholder approval."
SEC Charges Schwab Entities With Making Misleading Statements
On January 11, 2011 the SEC announced that it "charged Charles Schwab Investment Management (CSIM) and Charles Schwab & Co., Inc. (CS&Co.) with making misleading statements regarding the Schwab YieldPlus Fund and failing to establish, maintain and enforce policies and procedures to prevent the misuse of material, nonpublic information. The SEC also charged CSIM and Schwab Investments with deviating from the YieldPlus fund's concentration policy without obtaining the required shareholder approval."
Complaint
According to the SEC: "Between 2005 and mid-2008, Charles Schwab Investment Management, Inc. ('CSIM'), Charles Schwab & Co., Inc. ('CS&Co.'), and Schwab Investments: (1) offered and sold the Fund as a cash alternative without adequately disclosing the differences between the Fund and the cash investments with which it was compared, which mislead investors; (2) deviated from the Fund's concentration policy when it invested more than 25% of the Fund assets in non-agency mortgage-backed securities without obtaining a shareholder vote as required by statute; (3) made inaccurate statements concerning the Fund while its NAV declined; and (4) failed to establish and implement internal controls reasonably designed to prevent the misuse of material, nonpublic information."
Final Judgment as to Defendants Charles Schwab Investment Management, Charles Schwab & Co., and Schwab Investments
On February 16, 2011, Federal District Judge William Alsup ordered the final judgment in the matter pursuant to the consent of the SEC and the defendants Charles Schwab Investment Management, Charles Schwab & Co., Inc., and Schwab Investments.
court_doc29_11-cv-00136
04-Apr-2011
Court Docket Document
Order Appointing Distribution Agent and Establishing a Fair Fund
court_doc37_11-cv-00136
07-Jun-2011
Court Docket Document
Order Approving Distribution Plan With Modification
court_doc64_11-cv-00136
18-Apr-2013
Court Docket Document
Order Granting Motion for Distribution of Funds
court_doc85_11-cv-00136
23-Jun-2014
Court Docket Document
Order to Distribute Residual Funds to Harmed Investors
court_doc94_11-cv-00136
11-Oct-2016
Court Docket Document
Order Approving the Final Accounting, Transferring Funds to the United States Treasury, Discharging the Distribution Agent, and Terminating the Distribution Fund
court_doc97_11-cv-00136
05-Dec-2016
Court Docket Document
Stipulation and Amended Order Approving the Final Accounting, Transferring Funds to the Securities and Exchange Commission, Discharging the Distribution Agent, and Terminating the Distribution Fund
Other Defendants in Action:
