On June 9, 2025, a consortium of state regulators announced a settlement of charges against LPL, Edward Jones, Stifel, RBC and TD Ameritrade concerning a practice of charging unreasonable commissions.
The uniform state securities act, the model law that has been accepted by states for uniformity, prohibit the charging of unreasonable commissions to their client investors. A commission of under 5% can be considered excessive depending on the trade. The charge alleges $19 million in overcharges.
The LPL overcharging concerns a number of small trades of retail investors. The firms in some instances imposed minimum charges per trade of $25 to $95. This disproportionately impacts small investors and low principal trades.
William Galvin of the Massachusetts state regulator is part of this action and has led many investor protections actions previously. He indicated that this type of issue is something he and other securities regulators have been watching closely,
In addition to repayment of the overcharge, the firms agreed to fines equaling $10 million.
The regulators pursued such practices in Alabama, Alaska, Arkansas, California, Colorado, Delaware, Georgia, Hawaii, Idaho, Iowa, Illinois, Indiana, Maine, Missouri, Montana, Mississippi, New Mexico, North Carolina, North Dakota, Ohio, Pennsylvania, South Dakota, South Carolina, Texas, Washington, Wisconsin and West Virginia; however, it is believed that the issue extended nationwide.
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