Robert Lyons, of Augusta Georgia, submitted a Letter of Acceptance, Waiver and Consent (AWC) to the Department of Enforcement of the Financial Industry Regulatory Authority (FINRA) for allegedly executing unsuitable mutual fund switches in the accounts of three customers.
FINRA alleged that between January 2011 and December 2013, Robert Lyons recommended and effected fourteen unsuitable mutual fund switches in the accounts of three customers, resulting in unnecessary fees for his customers. Mutual fund “switching” is simply the process of transferring an investment from one mutual fund to another, sometimes for good reasons and other times to defraud clients. Some brokers attempt to effect numerous switches in client accounts in order to generate commissions. In the case of Mr. Lyons, FINRA found that the former Cambridge Investment Research representative caused unnecessary losses to his clients and additional commissions for himself as a result of the mutual fund “switches” he recommended. FINRA found that Mr. Lyons recommended his customers purchase Class A and Class T shares for the switches, which were only advantageous if the customers held them on a long-term basis, usually several years or more. In this case, the switches recommended and effected by Mr. Lyons were held for less than one year and all of the customers involved incurred added and unnecessary commission charges. Continue reading →