RBC Dain Rauscher Background Information
RBC Dain Rauscher is RBC’s
As told to me by Mr. Alex Hawkins over 35 years ago, he and John Rauscher, Sr. worked in the municipal bond department of a Dallas bank but left during the depression to start their own municipal bond firm. The two separately made sales calls on country banks with $500 and $1,000 denomination bearer municipal bonds in their briefcases. Pierce later joined them and, over several decades, the firm grew into full-service regional brokerage firm.
Joe Refsnes of
In 1981, two comparable regional firms of Minnesota-based Dain Bosworth and
The firm was acquired by Royal Bank of
Shepherd Smith Edwards & Kantas LTD LLP Law Firm
Our law firm represents institutional and individual investors nationwide with significant losses in their portfolios, retirement plans or investment accounts. Our attorneys and staff have more than 100 years of combined experience in the securities industry and in securities law. Several of our lawyers served for years as Vice President or Compliance Officer of brokerage firms.
Each lawyer and staff member of our firm is devoted to assisting investors to recover losses caused by unsuitability, over-concentration, fraud, misrepresentation, self-dealing, unauthorized trades or other wrongful acts, whether intentional or negligent. We have handled over a thousand cases against hundreds of large and small investment firms, including against Rauscher Pierce, Dain Rauscher and RBC Dain Rauscher.
Call us at (800)259-9010 or contact us through our Website to arrange a free confidential consultation with an attorney to discuss your experiences with an investment advisor or financial firm which resulted in losses.
RBC Sets Aside $500 Million for Enron Woes
Royal Bank of
RBC agreed to pay Enron $25 million to settle claims against it and its officers and another $24 million to resolve claims involved with the Enron bankruptcy estate. The agreement thus resolved claims between RBC and Enron related to the bankruptcy case. In agreeing to settle these, RBC did not admit any wrongdoing or liability.
Additional investigations and civil claims continued against RBC and its affiliates at the time of these settlements, which RBC stated it would “vigorously defend.” One allegation was that RBC lent $517 million to Enron so that an Enron affiliate could buy million shares of
Dain Rauscher Fined $1.7 Mil over Secret Deals
The National Association of Securities Dealers, Inc fined RBC Dain Rauscher and other firms for secret deals to provide preferential treatment to certain mutual fund companies in return for directed brokerage business from those mutual funds.
In fining RBC Dain Rauscher $1.7 million, the NASD stated that it violated duties to its clients by favoring certain mutual funds over others in order to receive reciprocal payments from such funds and failed to properly disclose such conflicts to clients. The prohibited quid-pro-quo practice is known as "preferred partner" or "shelf space" programs in which benefits are provided to mutual fund complexes which agree, in return, to directed unrelated orders to the brokerage firm to transact for a fee.
"When recommending mutual fund investments, firms must act on the basis of the merits of the funds and the investment objectives of the customers and not because of other benefits the brokerage firm will receive," said a NASD spokesperson, "NASD's prohibition on the receipt of directed brokerage is designed to eliminate these conflicts of interest."
Dain Rauscher Fined $1 Mil. For Trading Violations
The National Association of Securities Dealers cited Minneapolis-based Dain Rauscher for trading violations and fined the company $1 million and ordered it to also pay more than $158,000 in restitution to the harmed victims. The firm agreed to these sanctions without admitting or denying the charges.
The NASD cited Dain Rauscher for violations related to trading in corporate high-yield bonds (also known as “junk bonds”). It and three other firms were involved in an investigation that these firms charged clients excessive markups and/or markdowns on the bond trades as well as violating related supervision requirements.
According to the NASD, Dain Rauscher charged markups ranging from 5.5 % to 8% on trades in 2004, violated books and records requirements and failed to supervise its agents. The NASD findings state the four firms, which also includes RBC Capital Markets Corp., all violated the applicable rules and were fined for the violations.
RBC Dain Rauscher' Money Laundering Violations
The New York Stock Exchange fined RBC Dain Rauscher Inc. $90,000 for failures related to its anti-money laundering compliance program.
The NYSE stated that the Minneapolis-based firm failed to establish written procedures regarding filing of suspicious activity reports. Additionally, the exchange alleged, the firm did not have an adequate monitoring system to review and document follow-up on exceptions found by the firm's department, the release stated.
The action came under the exchange's most recent round of enforcement activity in which 11 individuals were also disciplined on allegations that included books and records and supervisory deficiencies, sales-practice misconduct, and failure to disclose prior criminal history, the release noted. The firm settled, neither admitting nor denying the allegations.
RBC and Agents Charged with ‘
RBC Dominion Securities and four of its traders are accused of what is called "wash trading" in shares of the brokerage firm's parent firm, Royal Bank of
The RBC traders were accused of buying and selling more than $33 million worth of shares at the same time — thus, improperly taking both sides of the trades — to cut risks they faced because of a series of earlier trading errors and misunderstandings. The allegations were made by the Market Regulation Services, a Canadian agency which is similar to the New York Stock Exchange. The outcome of this investigation is unknown at this time.