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In December of 2004, Edward D. Jones entered into an Admission Waiver and Consent (“AWC”) with the National Association of Securities Dealers (NASD) and was issued a Cease and Desist Order from the SEC, which resulted in fines totaling $75 million for failing to properly disclose to its clients the extent and nature of its relationship with what came to be known as “the Preferred Family of Mutual Funds.” It was found that Edward Jones failed to tell its clients that they were only going to be shown funds from the preferred list because Jones was receiving directed commissions and had revenue sharing arrangements and proprietary training and research arrangements with these fund families, to the exclusion of all other fund families that Jones had selling agreements with.

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