In re Off-Channel

 
UNITED STATES OF AMERICA 
Before the 
SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES ACT OF 1933 
Release No. 11298 / August 14, 2024 
 
 
 
In the Matter of 
 
            
           Off-Channel 
           Communications at 
           Registered Entities  
            
           
            
 
Respondents. 
 
           
 
          ORDER UNDER RULES 262(b)(2),   
          506(d)(2)(ii), AND 602(e) OF THE  
          SECURITIES ACT OF 1933 AND RULE  
          503(b)(2) OF REGULATION      
          CROWDFUNDING GRANTING    
          WAIVERS OF THE DISQUALIFICATION     
          PROVISIONS OF RULES 262(a)(4)(ii),  
          506(d)(1)(iv)(B), AND 602(c)(3) OF THE  
          SECURITIES ACT OF 1933 AND RULE  
          503(a)(4)(ii) OF REGULATION  
          CROWDFUNDING 
           
 
I. 
 
Pursuant to the Initiative to Investigate Off-Channel Communications at Registered 
Entities (“Off-Channel Communications Initiative”),
1
 the Division of Enforcement determined to 
recommend that the Securities and Exchange Commission (“Commission”) accept settlement 
offers from 11 SEC registered broker-dealers (“Broker-Dealers”), three SEC registered 
investment advisers (“Investment Advisers”), and 11 dual-registered broker-dealer and 
investment advisers (“Dual-Registered Entities”) (together, the “Firms”) that committed certain 
non-scienter based recordkeeping violations of the federal securities laws and agreed to consent 
to certain standardized settlement terms.   
 
II. 
 
The Commission has issued separate orders (“Recordkeeping Orders”) instituting 
administrative and cease-and-desist proceedings against the Firms.
2
  These proceedings are 
 
1
 The Off-Channel Communications Initiative is an investigative initiative conducted by the Division of 
Enforcement.   
 
2
 The 25 Firms subject to this Order are named in the Appendix to this Order.  Apex Clearing Corporation, BNY 
Mellon Securities Corporation (“BNYMSC”), Cetera Investment Services LLC, Cowen and Company, LLC, First 
Trust Portfolios L.P., Great Point Capital, LLC, Haitong International Securities (USA) Inc., Pershing LLC, TD 
Securities (USA) LLC, Truist Investment Services, Inc., and Truist Securities, Inc. are Commission-registered 
broker-dealers; Cowen Investment Management LLC (“CIM”), Epoch Investment Partners, Inc., and Truist 
Advisory Services, Inc. are Commission-registered investment advisers; and Ameriprise Financial Services, LLC,  

2 
 
consistent with previously-accepted settlement terms and are brought pursuant to Sections 15(b) 
and 21C of the Securities Exchange Act of 1934 (“Exchange Act”) and Sections 203(e) and 
203(k) of the Investment Advisers Act of 1940 (“Advisers Act”) for willful violations of Section 
17(a) of the Exchange Act and Rule 17a-4(b)(4) thereunder by the Dual-Registered Entities and 
Broker-Dealers and for willful violations of Section 204 of the Advisers Act and Rule 204-
2(a)(7) thereunder by the Dual-Registered Entities and Investment Advisers for their failure to 
comply with the recordkeeping requirements on broker-dealers and investment advisers to ensure 
that they responsibly discharge their crucial roles in our markets.  Specifically, the Firms failed 
to keep for prescribed periods, and furnish copies of, such business–related records as necessary 
or appropriate in the public interest or for the protection of investors.  The Firms admit to facts 
set forth in their respective Recordkeeping Orders and acknowledge that their conduct violated 
the federal securities laws.  The Recordkeeping Orders will require the Dual-Registered Entities 
and Broker-Dealers to cease and desist from committing or causing any violations and any future 
violations of Section 17(a) of the Exchange Act and Rule 17a-4 thereunder, require the Dual-
Registered Entities and Investment Advisers to cease and desist from committing or causing any 
violations and any future violations of Section 204 of the Advisers Act and Rule 204-2 
thereunder, and require the Firms to, among other things, undertake to retain a compliance 
consultant to conduct a comprehensive review of their supervisory, compliance, and other 
policies and procedures designed to ensure that all relevant electronic communications are 
preserved in accordance with the requirements of the federal securities laws.  The Recordkeeping 
Orders will trigger certain disqualifications from exemptions from registration available under 
the Securities Act of 1933 (“Securities Act”) for the Firms. 
 
III. 
 
 Rule 262(a) of Regulation A provides for disqualification from the Regulation A 
exemption from registration under the Securities Act for offerings if, among other things, the 
relevant entity is subject to a Commission order pursuant to Section 15(b) of the Exchange Act 
or Section 203(e) of the Advisers Act that places limitations on that entity’s activities, functions, 
or operations.  See 17 C.F.R. § 230.262(a)(4)(ii).  Similarly, Rules 506(d) of Regulation D and 
503(a) of Regulation Crowdfunding provide for disqualification from the Regulation D and 
Regulation Crowdfunding exemptions from registration under the Securities Act for certain 
offerings if, among other things, the relevant entity is subject to a Commission order pursuant to 
Section 15(b) of the Exchange Act or Section 203(e) of the Advisers Act that places limitations 
on that entity’s activities, functions, or operations.  See 17 C.F.R. §§ 230.506(d)(1)(iv)(B) and 
227.503(a)(4)(ii).  
 
 
Cetera Advisor Networks LLC (“Cetera Advisor Networks”), Edward D. Jones & Co., L.P., Hilltop Securities Inc., 
LPL Financial LLC, Osaic Services, Inc. (“Osaic Services”), Osaic Wealth, Inc., Piper Sandler & Co., Raymond 
James & Associates, Inc., RBC Capital Markets, LLC, and TD Private Client Wealth LLC are dual-registered 
broker-dealers and investment advisers.  While Cetera Advisor Networks and Osaic Services are treated as dual-
registered entities and CIM is treated as a Commission-registered investment adviser for purposes of this Order, 
effective July 6, 2023, September 29, 2023, and December 15, 2023, respectively, Cetera Advisor Networks, Osaic 
Services, and CIM are no longer Commission-registered investment advisers.  Finally, while BNYMSC is also 
registered with the Commission as an investment adviser, it is being treated as a broker-dealer for purposes of this 
Order as its Recordkeeping Order charges violations only of the Exchange Act. 

3 
 
Rule 602(a) of Regulation E provides an exemption from registration under the Securities 
Act, subject to certain conditions, for securities issued by certain small business investment 
companies and business development companies.  See 17 C.F.R. § 230.602(a).  Rule 602(c)(3) of 
Regulation E makes this exemption unavailable for the securities of an issuer if, among other 
things, any investment adviser or any underwriter of the securities to be offered is subject to an 
order of the Commission entered pursuant to Section 15(b) of the Exchange Act or Section 
203(e) of the Advisers Act.  See 17 C.F.R. § 230.602(c)(3).   
 
The Commission has the authority to waive the disqualifications of Regulations A, D, E, 
and Crowdfunding upon a showing of good cause and without prejudice to any other action by 
the Commission, if the Commission determines that it is not necessary under the circumstances 
that an exemption be denied.  See 17 C.F.R. §§ 230.262(b)(2), 230.506(d)(2)(ii), 230.602(e), and 
227.503(b)(2). 
 
In light of the Firms’ participation in the Off-Channel Communications Initiative, 
assuming the Firms comply with the terms of the Recordkeeping Orders, and in light of the 
benefits of the Off-Channel Communications Initiative, the Commission has determined that, 
pursuant to Rules 262(b)(2), 506(d)(2)(ii), and 602(e) of the Securities Act and Rule 503(b)(2) of 
Regulation Crowdfunding, good cause exists for not denying the various exemptions from 
registration discussed herein. 
 
IV. 
 
 Accordingly, IT IS ORDERED, pursuant to Rules 262(b)(2), 506(d)(2)(ii), and 602(e) of 
the Securities Act and Rule 503(b)(2) of Regulation Crowdfunding, that waivers from the 
application of the disqualification provisions of Rules 262(a)(4)(ii), 506(d)(1)(iv)(B), and 
602(c)(3) of the Securities Act and Rule 503(a)(4)(ii) of Regulation Crowdfunding, resulting 
from the entry of the Recordkeeping Orders against the Firms are hereby granted to the Firms as 
reflected in the attached appendix.  Nothing in this Order shall affect any pre-existing 
disqualification under the above provisions and nothing in this Order shall be interpreted to 
waive or limit any conditions or undertakings which are in place as a result of any prior waiver 
granted to any Firm.  Failure to comply with terms of a Recordkeeping Order would require us to 
revisit our determination that good cause has been shown and could constitute grounds to revoke  
  

4 
 
or further condition the waiver.  The Commission reserves the right, in its sole discretion, to 
revoke or further condition the waiver under these circumstances. 
 
Because of the unique nature of the Off-Channel Communications Initiative, this Order 
and the circumstances under which it was issued shall not be relied upon by any entity that may 
seek a waiver in the future from the disqualifications discussed herein. 
 
By the Commission. 
 
 
 
      Vanessa Countryman 
      Secretary 
 
Appendix: Firms     
  

5 
 
Appendix 
 
(Waivers from disqualification under Regulations A, D, E, and Crowdfunding) 
 
Ameriprise Financial Services, LLC 
Apex Clearing Corporation  
BNY Mellon Securities Corporation  
Cetera Advisor Networks LLC 
Cetera Investment Services LLC 
Cowen and Company, LLC 
Cowen Investment Management LLC 
Edward D. Jones & Co., L.P. 
Epoch Investment Partners, Inc. 
First Trust Portfolios L.P. 
Great Point Capital, LLC 
Haitong International Securities (USA) Inc. 
Hilltop Securities Inc.  
LPL Financial LLC 
Osaic Services, Inc. 
Osaic Wealth, Inc.  
Pershing LLC 
Piper Sandler & Co. 
Raymond James & Associates, Inc.  
RBC Capital Markets, LLC 
TD Private Client Wealth LLC 
TD Securities (USA) LLC 
Truist Advisory Services, Inc. 
Truist Investment Services, Inc. 
Truist Securities, Inc.  

UNITED STATES OF AMERICA 

Before the 

SECURITIES AND EXCHANGE COMMISSION 

 

SECURITIES ACT OF 1933 

Release No. 11298 / August 14, 2024 

 

 

 

In the Matter of 

 

            

           Off-Channel 

           Communications at 

           Registered Entities  

            

           

            

 

Respondents. 

 

           

 

          ORDER UNDER RULES 262(b)(2),   

          506(d)(2)(ii), AND 602(e) OF THE  

          SECURITIES ACT OF 1933 AND RULE  

          503(b)(2) OF REGULATION      

          CROWDFUNDING GRANTING    

          WAIVERS OF THE DISQUALIFICATION     

          PROVISIONS OF RULES 262(a)(4)(ii),  

          506(d)(1)(iv)(B), AND 602(c)(3) OF THE  

          SECURITIES ACT OF 1933 AND RULE  

          503(a)(4)(ii) OF REGULATION  

          CROWDFUNDING 

           

 

I. 

 

Pursuant to the Initiative to Investigate Off-Channel Communications at Registered 

Entities (“Off-Channel Communications Initiative”),1 the Division of Enforcement determined to 

recommend that the Securities and Exchange Commission (“Commission”) accept settlement 

offers from 11 SEC registered broker-dealers (“Broker-Dealers”), three SEC registered 

investment advisers (“Investment Advisers”), and 11 dual-registered broker-dealer and 

investment advisers (“Dual-Registered Entities”) (together, the “Firms”) that committed certain 

non-scienter based recordkeeping violations of the federal securities laws and agreed to consent 

to certain standardized settlement terms.   

 

II. 

 

The Commission has issued separate orders (“Recordkeeping Orders”) instituting 

administrative and cease-and-desist proceedings against the Firms.2  These proceedings are 

 
1 The Off-Channel Communications Initiative is an investigative initiative conducted by the Division of 

Enforcement.   

 
2 The 25 Firms subject to this Order are named in the Appendix to this Order.  Apex Clearing Corporation, BNY 

Mellon Securities Corporation (“BNYMSC”), Cetera Investment Services LLC, Cowen and Company, LLC, First 

Trust Portfolios L.P., Great Point Capital, LLC, Haitong International Securities (USA) Inc., Pershing LLC, TD 

Securities (USA) LLC, Truist Investment Services, Inc., and Truist Securities, Inc. are Commission-registered 

broker-dealers; Cowen Investment Management LLC (“CIM”), Epoch Investment Partners, Inc., and Truist 

Advisory Services, Inc. are Commission-registered investment advisers; and Ameriprise Financial Services, LLC,  



2 

 

consistent with previously-accepted settlement terms and are brought pursuant to Sections 15(b) 

and 21C of the Securities Exchange Act of 1934 (“Exchange Act”) and Sections 203(e) and 

203(k) of the Investment Advisers Act of 1940 (“Advisers Act”) for willful violations of Section 

17(a) of the Exchange Act and Rule 17a-4(b)(4) thereunder by the Dual-Registered Entities and 

Broker-Dealers and for willful violations of Section 204 of the Advisers Act and Rule 204-

2(a)(7) thereunder by the Dual-Registered Entities and Investment Advisers for their failure to 

comply with the recordkeeping requirements on broker-dealers and investment advisers to ensure 

that they responsibly discharge their crucial roles in our markets.  Specifically, the Firms failed 

to keep for prescribed periods, and furnish copies of, such business–related records as necessary 

or appropriate in the public interest or for the protection of investors.  The Firms admit to facts 

set forth in their respective Recordkeeping Orders and acknowledge that their conduct violated 

the federal securities laws.  The Recordkeeping Orders will require the Dual-Registered Entities 

and Broker-Dealers to cease and desist from committing or causing any violations and any future 

violations of Section 17(a) of the Exchange Act and Rule 17a-4 thereunder, require the Dual-

Registered Entities and Investment Advisers to cease and desist from committing or causing any 

violations and any future violations of Section 204 of the Advisers Act and Rule 204-2 

thereunder, and require the Firms to, among other things, undertake to retain a compliance 

consultant to conduct a comprehensive review of their supervisory, compliance, and other 

policies and procedures designed to ensure that all relevant electronic communications are 

preserved in accordance with the requirements of the federal securities laws.  The Recordkeeping 

Orders will trigger certain disqualifications from exemptions from registration available under 

the Securities Act of 1933 (“Securities Act”) for the Firms. 

 

III. 

 

 Rule 262(a) of Regulation A provides for disqualification from the Regulation A 

exemption from registration under the Securities Act for offerings if, among other things, the 

relevant entity is subject to a Commission order pursuant to Section 15(b) of the Exchange Act 

or Section 203(e) of the Advisers Act that places limitations on that entity’s activities, functions, 

or operations.  See 17 C.F.R. § 230.262(a)(4)(ii).  Similarly, Rules 506(d) of Regulation D and 

503(a) of Regulation Crowdfunding provide for disqualification from the Regulation D and 

Regulation Crowdfunding exemptions from registration under the Securities Act for certain 

offerings if, among other things, the relevant entity is subject to a Commission order pursuant to 

Section 15(b) of the Exchange Act or Section 203(e) of the Advisers Act that places limitations 

on that entity’s activities, functions, or operations.  See 17 C.F.R. §§ 230.506(d)(1)(iv)(B) and 

227.503(a)(4)(ii).  

 

 
Cetera Advisor Networks LLC (“Cetera Advisor Networks”), Edward D. Jones & Co., L.P., Hilltop Securities Inc., 

LPL Financial LLC, Osaic Services, Inc. (“Osaic Services”), Osaic Wealth, Inc., Piper Sandler & Co., Raymond 

James & Associates, Inc., RBC Capital Markets, LLC, and TD Private Client Wealth LLC are dual-registered 

broker-dealers and investment advisers.  While Cetera Advisor Networks and Osaic Services are treated as dual-

registered entities and CIM is treated as a Commission-registered investment adviser for purposes of this Order, 

effective July 6, 2023, September 29, 2023, and December 15, 2023, respectively, Cetera Advisor Networks, Osaic 

Services, and CIM are no longer Commission-registered investment advisers.  Finally, while BNYMSC is also 

registered with the Commission as an investment adviser, it is being treated as a broker-dealer for purposes of this 

Order as its Recordkeeping Order charges violations only of the Exchange Act. 



3 

 

Rule 602(a) of Regulation E provides an exemption from registration under the Securities 

Act, subject to certain conditions, for securities issued by certain small business investment 

companies and business development companies.  See 17 C.F.R. § 230.602(a).  Rule 602(c)(3) of 

Regulation E makes this exemption unavailable for the securities of an issuer if, among other 

things, any investment adviser or any underwriter of the securities to be offered is subject to an 

order of the Commission entered pursuant to Section 15(b) of the Exchange Act or Section 

203(e) of the Advisers Act.  See 17 C.F.R. § 230.602(c)(3).   

 

The Commission has the authority to waive the disqualifications of Regulations A, D, E, 

and Crowdfunding upon a showing of good cause and without prejudice to any other action by 

the Commission, if the Commission determines that it is not necessary under the circumstances 

that an exemption be denied.  See 17 C.F.R. §§ 230.262(b)(2), 230.506(d)(2)(ii), 230.602(e), and 

227.503(b)(2). 

 

In light of the Firms’ participation in the Off-Channel Communications Initiative, 

assuming the Firms comply with the terms of the Recordkeeping Orders, and in light of the 

benefits of the Off-Channel Communications Initiative, the Commission has determined that, 

pursuant to Rules 262(b)(2), 506(d)(2)(ii), and 602(e) of the Securities Act and Rule 503(b)(2) of 

Regulation Crowdfunding, good cause exists for not denying the various exemptions from 

registration discussed herein. 

 

IV. 

 

 Accordingly, IT IS ORDERED, pursuant to Rules 262(b)(2), 506(d)(2)(ii), and 602(e) of 

the Securities Act and Rule 503(b)(2) of Regulation Crowdfunding, that waivers from the 

application of the disqualification provisions of Rules 262(a)(4)(ii), 506(d)(1)(iv)(B), and 

602(c)(3) of the Securities Act and Rule 503(a)(4)(ii) of Regulation Crowdfunding, resulting 

from the entry of the Recordkeeping Orders against the Firms are hereby granted to the Firms as 

reflected in the attached appendix.  Nothing in this Order shall affect any pre-existing 

disqualification under the above provisions and nothing in this Order shall be interpreted to 

waive or limit any conditions or undertakings which are in place as a result of any prior waiver 

granted to any Firm.  Failure to comply with terms of a Recordkeeping Order would require us to 

revisit our determination that good cause has been shown and could constitute grounds to revoke  

  



4 

 

or further condition the waiver.  The Commission reserves the right, in its sole discretion, to 

revoke or further condition the waiver under these circumstances. 

 

Because of the unique nature of the Off-Channel Communications Initiative, this Order 

and the circumstances under which it was issued shall not be relied upon by any entity that may 

seek a waiver in the future from the disqualifications discussed herein. 

 

By the Commission. 

 

 

 

      Vanessa Countryman 

      Secretary 

 

Appendix: Firms     

  



5 

 

Appendix 

 
(Waivers from disqualification under Regulations A, D, E, and Crowdfunding) 

 
Ameriprise Financial Services, LLC 

Apex Clearing Corporation  

BNY Mellon Securities Corporation  

Cetera Advisor Networks LLC 

Cetera Investment Services LLC 

Cowen and Company, LLC 

Cowen Investment Management LLC 

Edward D. Jones & Co., L.P. 

Epoch Investment Partners, Inc. 

First Trust Portfolios L.P. 

Great Point Capital, LLC 

Haitong International Securities (USA) Inc. 

Hilltop Securities Inc.  

LPL Financial LLC 

Osaic Services, Inc. 

Osaic Wealth, Inc.  

Pershing LLC 

Piper Sandler & Co. 

Raymond James & Associates, Inc.  

RBC Capital Markets, LLC 

TD Private Client Wealth LLC 

TD Securities (USA) LLC 

Truist Advisory Services, Inc. 

Truist Investment Services, Inc. 

Truist Securities, Inc.