Wealthfront Fined in SEC's First Actions Against Robo-Advisers
- Agency cites false statements on tax-loss harvesting strategy
- Hedgeable separately sanctioned over statement on performance
Photographer: SeongJoon Cho/Bloomberg
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The U.S. Securities and Exchange Commission filed its first-ever enforcement actions against robo-advisers, accusing Wealthfront Advisers LLC and another firm of making false statements about investment products and publishing misleading advertisements.
Wealthfront, a robo-adviser with more than $11 billion in client assets under management, made false statements over a three-year period about a tax-loss harvesting strategy it offered to clients, the SEC said in a statement Friday. The agency also said the firm broke rules in re-tweeting client testimonials, paying bloggers for referrals and failing to maintain a compliance program sufficient to prevent violations of the securities laws.