Under the terms of the settlement, Morgan Keegan agreed to disclose to its ERISA plan clients whether the company will act as a fiduciary to those plans. If the company is acting as a fiduciary, it will specify the services that it is providing. Morgan Keegan also will provide to these clients a description of all compensation and fees received, in any form, from any source, involving all related investments or transactions. The company either will not collect commissions or, if it does collect them, refund to its ERISA plans clients 100% of the amount collected from third parties.
“The law is very clear: If you accept a fee to give investment advice to a retirement plan, you are a fiduciary and must therefore act solely in the best interests of the participants in that plan,” said Phyllis C. Borzi, assistant secretary of labor for employee benefits security. “Third-party payments should never be the motivating factor behind which investments brokers and advisers steer retirement clients into.”
The alleged violations occurred between April 2001 and November 2008. Morgan Keegan is based in Memphis, Tennessee and currently is owned by Regions Financial Corp. of Birmingham, Alabama.
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