RBC Fined $200,000 over Former Broker’s Unsuitable Energy Trades
RBC Wealth Management-U.S. consented to pay a $200,000 fine and to offer to reimburse senior citizen investors for failing to supervise a veteran broker who over-concentrated them in energy sector investments, the state of Massachusetts said on Thursday.
The broker, Bruce Taylor Cameron, worked at RBC and a predecessor firm in the state for more than 19 years of his almost 51-year career, according to his BrokerCheck history. He consented to a cease-and-desist order in May 2020 for piling clients into energy master limited partnerships, and in 2017 agreed to pay a customer almost $689,000 for over-concentration in the unsuitable investments. He has not been a broker or adviser since November 2020.
RBC this week consented to the fine for failing to supervise Cameron, a censure and the offer to reimburse ten customers, according to a news release from William Galvin, Massachusetts’ activist secretary of the commonwealth.
“RBC’s own policies and procedures provide guidelines regarding account concentration, stating that diligent supervision should be performed in situations where an account has more than 30% of the portfolio invested in a single sector,” the news release said. “Many of the investors listed in the complaint had the vast majority of their accounts concentrated in energy sector securities, with several reaching nearly 100%.”
In “voluntarily” agreeing to the consent order, RBC did not admit to any supervisory deficiencies, a spokesman for the firm’s U.S. wealth management business said.
“[T]he customers’ accounts were appropriately supervised and were consistent with their stated investment goals and financial circumstances, as well as RBC’s policies,” he wrote in an e-mail. “The customer accounts generated substantial income that exceed the commissions charged.”
Cameron voluntarily retired last year with “only one customer complaint” throughout his career and no previous disciplinary actions from regulators, the spokesman wrote. He did not respond to a request for comment on specifics of the reimbursement offers.
Cameron began his career in 1970 with E.F. Hutton, remaining with it and successor firms Lehman Brothers and Smith Barney until 1994, when he joined PaineWebber, according to his BrokerCheck history. He worked for a year at Chase Securities in 2000 before joining Tucker Anthony, a Boston-based firm, in 2001. Royal Bank of Canada bought Tucker Anthony that year.