HARRISBURG, Pa., April 17, 2015 /PRNewswire-USNewswire/ -- Following Governor Tom Wolf's declaration of April as Financial Education Month, the PA Department of Banking and Securities today issued an investor advisory to help raise awareness about fees charged by broker-dealers for services and maintenance of investors' accounts. A broker-dealer is a firm that is in the business of trading securities on behalf of customers or for its own account.
"Financial education is about empowering people to take charge of their financial futures and learning how to make good decisions with their money," said Acting Secretary of Banking and Securities Robin L. Wiessmann. "It is especially important that consumers learn about how to read the so-called 'fine print' in financial transactions and ask questions to their own satisfaction."
The advisory cites new research from the North American Securities Administrators Association (NASAA). The research shows that many investors are confused about the service and maintenance fees charged to their investment accounts. The NASAA research also indicates that investors want clear and easy access to fee information from their broker-dealers.
To help raise investor understanding of investment fees, the Department of Banking and Securities suggests investors focus on the timing, method, and content of fee disclosures:
- Fees are typically disclosed when an investment account is opened. You have the right to know the fees in advance. Ask your broker-dealer for a fee schedule and make sure it is up to date.
- Watch out for fee changes. Most broker-dealers disclose fee changes at least 30 days in advance, but they may use different methods to reach investors. Make sure your broker-dealer knows how you prefer to be contacted.
- Investors are responsible for reading and understanding all fee disclosure materials. If you cannot find the information you need on fees and charges, ask for it. If you cannot understand the fee schedule, make sure your broker-dealer explains it and that you are satisfied with the explanation.
- Different broker-dealers may use different terms for the same service. Know the services you anticipate using regularly and ask specifically what terms a firm uses for its services and fees.
The Department of Banking and Securities has posted an investor advisory online: www.dobs.pa.gov. To learn more about investing, consumers can visit PA Investor Education on Facebook: www.facebook.com/PAInvestorEducation. The NASAA survey, "Investor Confusion About Brokerage Service & Maintenance Fees," can be found online: www.nasaa.org.
MEDIA CONTACT: Ed Novak, 717-783-4721
SOURCE Pennsylvania Department of Banking and Securities