RBC Customer Alert

Attention RBC customers: contact investor lawyers for a free evaluation of your potential options and claims for compensation today.

✓ Do you have an account with RBC Capital Markets?

✓ Are you concerned about potential losses or missed profits in your RBC account due to questionable fees?

✓ Would you like your potential claims for compensation to be reviewed by an experienced team of investor lawyers?

Request a free case evaluation via email at arosca@rscounsel.law, through the contact form on this page, or by calling 888-998-0530.

Free Case Evaluation

Posted February 24, 2024

Attention RBC Investors: Investor Lawyers Investigating Compensation Claims for RBC Customers

The investor rights attorneys at Rosca Scarlato LLC, led by veteran investor advocates Alan Rosca and Paul Scarlato, are investigating potential claims for compensation on behalf of customers with brokerage accounts at RBC. They are primarily focused on certain fees and default investments offered by RBC in customer accounts, as well as other types of account-related questionable activities.

Investors who own RBC brokerage accounts and would like to learn more about their potential claims for compensation may contact investor rights attorneys Alan Rosca, or Paul Scarlato. Claims that are not timely pursued may expire or otherwise be lost, generally speaking.

RBC customers may contact attorneys Alan Rosca or Paul Scarlato to discuss their potential options toll free at 888-998-0530, via email at arosca@rscounsel.law, or through the contact form on this webpage.

RBC Capital Markets Faced Repeated Regulatory Sanctions by FINRA

RBC Capital Markets, LLC, a member of the Financial Industry Regulatory Authority (FINRA), has been the subject of a series of regulatory sanctions over the past several years for failing to maintain adequate supervisory systems. These sanctions, imposed by FINRA, reveal a pattern of alleged compliance failures across various aspects of the firm’s operations, from customer account management to employee trading oversight. Several of the more recent sanctions are detailed below.

In March 2024, RBC was sanctioned for allegedly failing to provide certain customers with mutual fund sales charge waivers and fee rebates to which they were entitled. According to the AWC, from January 2016 to December 2023, RBC customers across more than 1,450 accounts paid approximately $265,000 in excess sales charges and fees due to RBC’s supervisory deficiencies . Without admitting or denying FINRA’s allegations, RBC agreed to a censure and a fine of $75,000. RBC also paid full restitution to the affected customers.

In April 2023, sanctions without admitting or denying FINRA’s allegations, RBC agreed to be censured and pay $300,000 in fines, $128,643 in restitution to customers, and $653,312.83 in disgorgement of ill-gotten gains for alleged failure to supervise its registered representatives who allegedly recommended to retail customers short-term trading of syndicate preferred stocks. According to the AWC, between January 2017 and December 2018, here were at least 798 recommended syndicate preferred stock purchases with a holding period of 180 days or less where there was a realized loss on the sale, According to FINRA nearly 40 RBC representatives engaged in this alleged practice, with one representative alone accounting for 186 purchases in multiple customer accounts.

In December 2021, RBC was censured, fined $550,000 and ordered to pay $456,155, plus interest, in restitution for alleged failure to supervise its representatives’ recommendations of high-yield corporate and municipal bonds, leading to over 100 conservative customer accounts having potentially unsuitable concentrations of these investments. In one case, a customer over 100 years old had 86% of one trust account and 100% of another invested in high-yield municipal bonds, the AWC notes. RBC agreed to the sanctions without admitting or denying FINRA’s findings.

In December 2019, RBC agreed to a censure and a $2.9 million fine for allegedly failing to deliver prospectuses to customers who purchased approximately 165,000 exchange-traded funds (ETFs) and exchange-traded notes (ETNs), as well as at least hundreds of thousands of mutual funds. According to the AWC, from March 2008 to June 2016, the firm’s supervisory system was not reasonably designed to ensure compliance with prospectus delivery rules. The firm allegedly relied on a single employee to manually code ETFs and ETNs for prospectus delivery, leading to widespread errors. RBC agreed to the sanctions without admitting or denying FINRA’s findings.

Has RBC Been Subject to Customer Disputes?

RBC Capital Markets has faced multiple arbitration cases brought by customers alleging a range of financial mismanagement issues, from negligence and breach of fiduciary duty to failure to supervise and investment unsuitability. In some of those cases, arbitration panels have ruled in favor of claimants, awarding substantial financial compensation.

In a case filed against RBC the customer alleged unsuitability, breach of duty of fair dealing, breach of duty to observe high standards of commercial honor, and failure to supervise, among others, in connection with investments in Jamaica Government bonds, Linn Energy LLC Senior Notes and BreitBurn Energy Partners LP Senior Notes. The panel found the firm liable, ordering RBC to pay $50,000 in compensatory damages, plus 6.1% annual interest and costs (Case No. 18-03865).

In an earlier dispute, two RBC customers alleged their advisor at RBC recommended highly speculative investments while failing to properly inform the client about the risks. The claimants also contended that their portfolio had been overly concentrated in volatile energy-sector assets that did not align with their financial objectives. The arbitration panel ruled in customers’ favor, awarding them $250,000 in compensatory damages (Case No. 16-03617).

Elder abuse and negligence were the causes of action at the center of another case decided in favor of RBC customers. Claimants alleged that RBC and other co-defendants engaged in unauthorized stock sales and fund transfers, causing financial harm. The panel found RBC liable and ultimately awarded the customers $212,000, plus 10% annual interest (Case No. 15-01863).

In another customer dispute, RBC and several other respondents faced allegations of breach of fiduciary duty, failure to supervise, and negligence, among others. The claimants argued that the alleged actions resulted in the loss of their monthly pension benefits. The RBC customers were awarded by a panel $559,612, plus 10% annual interest (Case No. 16-00512).

A year earlier, claimants brought claims against RBC Capital Markets and another defendant, alleging that RBC was grossly negligent in safeguarding claimants’ funds. The arbitration panel ruled that RBC was jointly and severally liable, awarding the claimants $419,370 in compensatory damages, along with 5% annual interest, plus expert fees and related expenses (Case No. 15-02212).

RBC also faced allegations of securities law violations, breach of fiduciary duty, and fraud related to investments in gold mutual funds. The arbitration panel found RBC Capital Markets liable and awarded claimants $175,000, plus 1% annual interest (Case No. 14-03809).

RBC Brokerage Customers May Have Potential Claims for Compensation

Investor rights attorneys Alan Rosca and Paul Scarlato at Rosca Scarlato have reviewed a substantial volume of records and other evidence related to this matter and would like to hear from RBC customers who are concerned about potential losses or missed profits in their brokerage accounts. They have decades of combined experience seeking compensation related to investor harm and pursuing claims arising out of alleged violations of securities law and/or other financial misconduct.

If you are a concerned RBC customer, you may contact attorneys Alan Rosca or Paul Scarlato to learn more about your rights and for an evaluation of your potential claims, or to provide useful information. All consultations are free.

The Rosca Scarlato attorneys typically take cases like this on a contingency fee basis, advance all case costs, and only get paid for their fees and expenses if and when they are successful.

To reach attorney Alan Rosca or his colleagues, call 888-998-0530, email arosca@rscounsel.law, or leave a message by using a contact form on this webpage.

The general considerations on this page are for informational purposes only and do not constitute legal advice. Such legal advice can only be offered once the attorneys discuss each investor’s situation, learn of the relevant facts, and can tailor any advice to that investor’s facts. This page is not affiliated with RBC Capital Markets or other related person or entity.

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DISCLAIMER

In our legal system, every person is innocent until and unless found guilty by a court of law or a tribunal. Whenever we reference “allegations” or charges that are “alleged,” such allegations or charges have not been proven, and are merely accusations, not findings of fault, as of the date of the blog. We do not have, nor do we undertake, a duty to continue to monitor or follow matters about which we report, and/or to publish subsequent updates regarding various developments that may occur in such matters. Readers are encouraged to conduct their own research regarding any such matters and any developments that may or may not have occurred in such matters. Also, the Brokercheck report linked to some of our blogs is the up-to-date version as of the date of accessing by the reader. The information in our blogs is current as of the date of the drafting of the blog, and given that sometimes certain past complaints may no longer be listed in newer Brokercheck reports, some of the events referenced in some of our blogs may later on be removed from newer Brokercheck reports. Visitors may check the most recent version of each brokercheck report at www.finra.org, and may contact FINRA for the earlier version of the Brokercheck report upon which various blogs may be based.