Examiners with the Securities and Exchange Commission want to know if registered investment advisors are upholding their fiduciary obligations on the mutual funds they recommend to investors.
The Office of Compliance Inspections and Examinations issued a risk alert announcing its Share Class Initiative, which seeks to identify conflicts of interest in registered investment advisor investment recommendations.
Some share classes have "substantial" loads or distribution fees that advisors affiliated with a broker-dealer may have an incentive to recommend when less-expensive class options are available, according to the alert.
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