The Securities and Exchange Commission (SEC) has issued a Wells notice to Charles Schwab Corporation of San Francisco, California. A Wells notice is sent by the SEC to notify a company that civil actions may be brought against them. This notice concerns the handling of two mutual funds, Schwab YieldPlus Fund and the Schwab Total Bond Market Fund.
Investors in the two funds charge that they were deceived by Charles Schwab. Indeed, investors lost millions when the funds experienced a near total loss amid the subprime market collapse. In addition to the potential SEC civil charges, Charles Schwab has been hit by a multitude of FINRA arbitration claims as investors attempt to recover losses stemming from the now disreputable funds.
Now that Charles Schwab has received a Wells notice, it has the opportunity to comment, and attempt to dissuade the SEC from proceeding.
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