In January 2025, Edward D. Jones & Co., L.P. agreed to pay roughly $17 million to settle a multistate investigation into how it moved customers from commission-based brokerage accounts into fee-based advisory accounts between 2016 and 2018. The Edward Jones $17 million settlement was signed by securities regulators in all 50 states, Washington, D.C., the U.S. Virgin Islands, and Puerto Rico, and it does not include direct refunds to affected customers.1NASAA. NASAA Announces $17 Million Multi-State Enforcement Settlement With Edward Jones
What Edward Jones Was Accused Of
After the Department of Labor’s 2016 Fiduciary Rule, Edward Jones restricted trading in existing brokerage retirement accounts and encouraged clients to move into its “Guided Solutions” advisory program.2Washington State DFI. Consent Order No. S-19-2768-23-CO01
Many of those clients held Class A mutual fund shares, which carry front-end sales charges of up to 5 percent. Once moved into Guided Solutions, the same clients paid annual advisory fees of 0.5 to 1.35 percent. Edward Jones offered a two-year prorated fee offset to account for the front-end loads clients had already paid, but state regulators concluded the offset often did not cover what customers had actually spent, especially when they sold or moved the mutual fund shares sooner than expected.3California DFPI. Consent Order, Edward D. Jones and Co., L.P.
Regulators found that Edward Jones “did not have reasonably designed procedures” to detect issues with how long clients had held their Class A shares before the switch.2Washington State DFI. Consent Order No. S-19-2768-23-CO01 The states estimated that customers collectively paid more than $10 million in front-end loads that the firm retained without fully offsetting against subsequent advisory fees.4Alabama Securities Commission. Administrative Consent Order No. CA-2024-0032
The Settlement Terms
Edward Jones agreed to pay an administrative fine of approximately $320,754.72 to each of the 53 jurisdictions, for a total of roughly $17 million.1NASAA. NASAA Announces $17 Million Multi-State Enforcement Settlement With Edward Jones Some states received additional payments for investigative costs. New Jersey, for example, received an extra $15,000.5New Jersey Office of the Attorney General. Attorney General Platkin Announces Nationwide Edward Jones Settlement
The firm neither admitted nor denied the findings. The consent orders explicitly state that the settlement is “not intended to state or imply willful, reckless, or fraudulent conduct or breach of any fiduciary duty,” and Texas regulators, who co-led the investigation, said they found no evidence of willful or fraudulent conduct.3California DFPI. Consent Order, Edward D. Jones and Co., L.P.6Texas State Securities Board. Texas, Montana Lead Multiple States in $17 Million Settlement With Edward Jones for Supervisory Failures
Why There Are No Customer Refunds
The $17 million goes to state regulators, not to affected clients. Regulators said they chose not to require restitution because the advisory accounts generally performed well compared with the brokerage accounts they replaced, the per-customer amount at issue was low, individual circumstances varied widely, and a significant amount of time had passed since the conduct occurred.4Alabama Securities Commission. Administrative Consent Order No. CA-2024-0032 The consent orders do not disclose how many customers were affected.
Who Investigated and What Period It Covered
A working group of 14 state securities regulators, coordinated through the North American Securities Administrators Association (NASAA), led the four-year investigation. Texas and Montana headed the effort.6Texas State Securities Board. Texas, Montana Lead Multiple States in $17 Million Settlement With Edward Jones for Supervisory Failures The conduct at issue took place in a roughly two-year window from July 2016 through June 2018, when the bulk of the account conversions happened.2Washington State DFI. Consent Order No. S-19-2768-23-CO01
Earlier Edward Jones Settlements That Did Pay Customers
The 2025 action should not be confused with earlier cases that returned money to clients. In 2004, the SEC, NASD, and New York Stock Exchange jointly settled with Edward Jones over undisclosed revenue-sharing arrangements with seven “Preferred Mutual Fund Families.” That settlement cost the firm $75 million in disgorgement and civil penalties, which were placed in a fund to compensate affected customers.7SEC. SEC, NASD, NYSE Settle Enforcement Proceedings Against Edward Jones A separate class action, Spahn v. Edward D. Jones & Co., L.P., resulted in $72.5 million in credits for current customers and $55 million in cash for former customers.8Stull, Stull & Brody. Settled Securities Class Action Cases The 2025 multistate settlement, by contrast, pays only regulators.