waddell & reed - finra · waddell & reed crd# 866 sec# 8-27030 main office location 6300...

BrokerCheck Report

WADDELL & REED

Section Title

Report Summary

Firm History

CRD# 866

1

9

Firm Profile 2 - 8

Page(s)

Firm Operations 10 - 16

Disclosure Events 17

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WADDELL & REED

CRD# 866

SEC# 8-27030

Main Office Location

6300 LAMAR AVENUEOVERLAND PARK, KS 66202-4200Regulated by FINRA Kansas City Office

Mailing Address

P.O. BOX 29217SHAWNEE MISSION, KS 66201-9217

This firm is a brokerage firm and an investmentadviser firm. For more information aboutinvestment adviser firms, visit the SEC'sInvestment Adviser Public Disclosure website at:

Business Telephone Number

913-236-2000

https://www.adviserinfo.sec.gov

Report Summary for this Firm

This report summary provides an overview of the brokerage firm. Additional information for this firm can be foundin the detailed report.

Disclosure Events

Brokerage firms are required to disclose certaincriminal matters, regulatory actions, civil judicialproceedings and financial matters in which the firm orone of its control affiliates has been involved.

Are there events disclosed about this firm? Yes

The following types of disclosures have beenreported:

Type Count

Regulatory Event 28

Civil Event 1

Arbitration 12

Bond 3

Firm Profile

This firm is classified as a corporation.

This firm was formed in Delaware on 08/11/1981.

Its fiscal year ends in December.

Firm History

Information relating to the brokerage firm's historysuch as other business names and successions(e.g., mergers, acquisitions) can be found in thedetailed report.

Firm Operations

Is this brokerage firm currently suspended with anyregulator? No

This firm conducts 12 types of businesses.

This firm is affiliated with financial or investmentinstitutions.

This firm has referral or financial arrangements withother brokers or dealers.

This firm is registered with:

• the SEC• 1 Self-Regulatory Organization• 53 U.S. states and territories

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1©2018 FINRA. All rights reserved. Report about WADDELL & REED

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This firm is classified as a corporation.

This firm was formed in Delaware on 08/11/1981.

CRD#

This section provides the brokerage firm's full legal name, "Doing Business As" name, business and mailingaddresses, telephone number, and any alternate name by which the firm conducts business and where such name isused.

Firm Profile

Firm Names and Locations

Its fiscal year ends in December.

WADDELL & REED, INC.

SEC#

866

8-27030

Main Office Location

Mailing Address

Business Telephone Number

Doing business as WADDELL & REED

913-236-2000

Regulated by FINRA Kansas City Office

6300 LAMAR AVENUEOVERLAND PARK, KS 66202-4200

P.O. BOX 29217SHAWNEE MISSION, KS 66201-9217

Other Names of this Firm

Name Where is it used

WADDELL & REED AK, AL, AR, AZ, CA,CO, CT, DC, DE, FL,GA, HI, IA, ID, IL, IN,KS, KY, LA, MA, MD,ME, MI, MN, MO,MS, MT, NC, ND, NE,NH, NJ, NM, NV, NY,OH, OK, OR, PA, PR,RI, SC, SD, TN, TX,UT, VA, VT, WA, WI,WV, WY






This section provides information relating to all direct owners and executive officers of the brokerage firm.

Direct Owners and Executive Officers

Firm Profile

Position

Percentage of Ownership

Is this a public reportingcompany?

Position Start Date

Does this owner direct themanagement or policies ofthe firm?

WADDELL & REED FINANCIAL SERVICES, INC.

SHAREHOLDER

75% or more

No

Domestic Entity

05/1993

Yes

Is this a domestic or foreignentity or an individual?

Legal Name & CRD# (if any):

Position



Position Start Date


BLOSS, BRENT KYLE

CHAIRMAN OF THE BOARD, SENIOR VICE PRESIDENT, TREASURER,DIRECTOR

Less than 5%

No

Individual

11/2017

Yes

4494253



Position

Position Start Date

BUYLE, MARK PATRICK

SENIOR VICE PRESIDENT, INTERIM GENERAL COUNSEL

Individual

03/2000

2656200








Direct Owners and Executive Officers (continued)

Firm Profile




Less than 5%

No

Yes

Position



Position Start Date


CLOUSE, BENJAMIN RUSSELL

SENIOR VICE PRESIDENT, PRINCIPAL ACCOUNTING OFFICER, DIRECTOR

Less than 5%

No

Individual

11/2017

Yes

6563686



Position



Position Start Date


DALEY, MICHAEL JOHN

PRINCIPAL FINANCIAL OFFICER

Less than 5%

No

Individual

05/2018

Yes

6923129



DEVINE, YVONNE J

5261367








Firm Profile

Position



Position Start Date


VP AND TREASURER

Less than 5%

No

Individual

03/2018

Yes

5261367


Position



Position Start Date


DORSEY, LORI ANN

SENIOR VICE PRESIDENT AND CHIEF MARKETING OFFICER

Less than 5%

No

Individual

08/2017

Yes

2077073



Position


Position Start Date


ERSKINE, ANN TERESA

VICE PRESIDENT

Less than 5%

Individual

10/2017

Yes

5071135









Firm Profile



No

Yes

Position



Position Start Date


GLENN, JACQUELYN ELAYNE

SENIOR VICE PRESIDENT AND CHIEF SUPERVISORY OFFICER

Less than 5%

No

Individual

10/2016

Yes

2260863



Position



Position Start Date


HANSEN, ELIZABETH ANN

SVP AND CHIEF COMPLIANCE OFFICER

Less than 5%

Individual

04/2018

Yes

2199658



MIHAL, SHAWN MICHAEL

Individual

3262384









Firm Profile

Position



Position Start Date


PRESIDENT, CHIEF OPERATIONS OFFICER AND DIRECTOR

Less than 5%

No

Individual

11/2017

Yes


Position



Position Start Date


REEVES, MATTHEW KIRK

SENIOR VICE PRESIDENT AND HEAD OF PRODUCT AND PLANNING

Less than 5%

No

Individual

08/2017

Yes

3087396








This section provides information relating to any indirect owners of the brokerage firm.

Indirect Owners

Firm Profile

WADDELL & REED FINANCIAL, INC.

SHAREHOLDER

WADDELL & REED FINANCIAL SERVICES,INC.

75% or more

Yes

Domestic Entity

05/1986

Yes



Company through whichindirect ownership isestablished

Relationship to Direct Owner

Relationship Established









Firm History

This section provides information relating to any successions (e.g., mergers, acquisitions) involving the firm.

No information reported.






Firm Operations

RegistrationsThis section provides information about the regulators (Securities and Exchange Commission (SEC), self-regulatoryorganizations (SROs), and U.S. states and territories) with which the brokerage firm is currently registered andlicensed, the date the license became effective, and certain information about the firm's SEC registration.

This firm is currently registered with the SEC, 1 SRO and 53 U.S. states and territories.

SEC Registration Questions

This firm is registered with the SEC as:

A broker-dealer:

A broker-dealer and government securities broker or dealer:

A government securities broker or dealer only:

This firm has ceased activity as a government securities broker or dealer:

Yes

Yes

No

No

Federal Regulator Status Date Effective

SEC Approved 01/14/1982

Self-Regulatory Organization Status Date Effective

FINRA Approved 11/04/1939






Firm Operations

Registrations (continued)

U.S. States &Territories

Status Date Effective

Alabama Approved 10/24/1981

Alaska Approved 02/27/1965

Arizona Approved 12/01/1969

Arkansas Approved 03/31/1980

California Approved 10/26/1981

Colorado Approved 02/01/1983

Connecticut Approved 10/26/1981

Delaware Approved 10/07/1981

District of Columbia Approved 02/26/1965

Florida Approved 04/27/1983

Georgia Approved 09/22/1981

Hawaii Approved 07/17/1987

Idaho Approved 01/01/1967

Illinois Approved 10/26/1981

Indiana Approved 10/21/1981

Iowa Approved 07/15/1983

Kansas Approved 01/04/1961

Kentucky Approved 07/16/1982

Louisiana Approved 04/20/1983

Maine Approved 02/15/1984

Maryland Approved 10/03/1981

Massachusetts Approved 07/31/1981

Michigan Approved 02/03/1983

Minnesota Approved 07/15/1982

Mississippi Approved 10/14/1981

Missouri Approved 07/18/1983

Montana Approved 04/20/1983

Nebraska Approved 10/09/1981

Nevada Approved 07/19/1983

New Hampshire Approved 02/02/1983

New Jersey Approved 07/19/1983

New Mexico Approved 10/07/1981

New York Approved 10/29/1981

U.S. States &Territories

Status Date Effective

North Carolina Approved 07/15/1982

North Dakota Approved 10/21/1981

Ohio Approved 07/16/1982

Oklahoma Approved 07/17/1982

Oregon Approved 10/24/1981

Pennsylvania Approved 05/15/1939

Puerto Rico Approved 01/01/2000

Rhode Island Approved 02/01/1983

South Carolina Approved 10/28/1981

South Dakota Approved 07/15/1982

Tennessee Approved 08/17/1981

Texas Approved 07/25/1983

Utah Approved 04/21/1983

Vermont Approved 02/15/1984

Virgin Islands Approved 03/07/2006

Virginia Approved 09/23/1981

Washington Approved 04/20/1983

West Virginia Approved 09/30/1981

Wisconsin Approved 12/17/1981

Wyoming Approved 05/28/1965






Firm Operations

Types of BusinessThis section provides the types of business, including non-securities business, the brokerage firm is engaged in orexpects to be engaged in.

This firm currently conducts 12 types of businesses.

Types of Business

Broker or dealer retailing corporate equity securities over-the-counter

Broker or dealer selling corporate debt securities

Mutual fund underwriter or sponsor

Mutual fund retailer

U S. government securities broker

Municipal securities broker

Broker or dealer selling variable life insurance or annuities

Solicitor of time deposits in a financial institution

Put and call broker or dealer or option writer

Investment advisory services

Trading securities for own account

Broker or dealer involved in a networking, kiosk or similar arrangment with a: bank, savings bank or association, orcredit union






Firm Operations

Clearing Arrangements

This firm does not hold or maintain funds or securities or provide clearing services for other broker-dealer(s).

Introducing Arrangements

This firm does refer or introduce customers to other brokers and dealers.

Name: PERSHING LLC

Business Address: ONE PERSHING PLAZAJERSEY CITY, NJ 07399

CRD #: 7560

Effective Date: 04/01/2008

Description: FIRM CLEARS TRADES THROUGH PERSHING LLC ON A FULLYDISCLOSED BASIS






Firm Operations

Industry Arrangements

This firm does have books or records maintained by a third party.

This firm does not have accounts, funds, or securities maintained by a third party.

This firm does not have customer accounts, funds, or securities maintained by a third party.

This firm does not have individuals who control its management or policies through agreement.

This firm does not have individuals who wholly or partly finance the firm's business.

Control Persons/Financing

Name: DST SYSTEMS, INC

Business Address: 333 W. 11TH STREETKANSAS CITY, MO 64105


Description: LOCATION WHERE ELECTRONIC BOOKS AND RECORDS ARE STORED.

Name: ALBRIDGE SOLUTIONS, INC

Business Address: ONE PERSHING PLAZAJERSEY CITY, NJ 07399


Description: LOCATION WHERE ELECTRONIC BOOKS AND RECORDS RELATING TOBROKERAGE ACCOUNTS CLEARED THROUGH PERSHING WILL BESTORED.






Firm Operations

Organization AffiliatesThis section provides information on control relationships the firm has with other firms in the securities, investmentadvisory, or banking business.

This firm is, directly or indirectly:

· in control of· controlled by· or under common control withthe following partnerships, corporations, or other organizations engaged in the securities or investmentadvisory business.

Yes

No

No

12/16/2002

6300 LAMAR AVEOVERLAND PARK, KS 66202

123381

IVY INVESTMENT MANAGEMENT COMPANY is under common control with the firm.

IVY INVESTMENT MANAGEMENT COMPANY, A REGISTERED INVESTMENTADVISER, IS A DIRECT SUBSIDIARY OF APPLICANT'S ULTIMATE PARENTCORPORATION, WADDELL & REED FINANCIAL, INC.

Description:

Investment AdvisoryActivities:

Securities Activities:

Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:

No

Yes

No

12/16/2002

6300 LAMAR AVENUEOVERLAND PARK, KS 66202

16496

IVY FUNDS DISTRIBUTOR, INC. is under common control with the firm.

IVY FUNDS DISTRIBUTOR, INC., A REGISTERED BROKER-DEALER, IS ANINDIRECT SUBSIDIARY OF APPLICANT'S ULTIMATE PARENT CORPORATION,WADDELL & REED FINANCIAL, INC.

Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

CRD #:






Firm Operations

Organization Affiliates (continued)IVY FUNDS DISTRIBUTOR, INC., A REGISTERED BROKER-DEALER, IS ANINDIRECT SUBSIDIARY OF APPLICANT'S ULTIMATE PARENT CORPORATION,WADDELL & REED FINANCIAL, INC.

Description:

Yes

No

No

01/08/1992

6300 LAMAR AVENUEOVERLAND PARK, KS 66202

WADDELL & REED INVESTMENT MANAGEMENT COMPANY is controlled by the firm.

APPLICANT OWNS ALL OF THE ISSUED AND OUTSTANDING STOCK OFWADDELL & REED INVESTMENT MANAGEMENT COMPANY, A REGISTEREDINVESTMENT ADVISER.

Description:



Country:

Foreign Entity:

Effective Date:

Business Address:

This firm is not directly or indirectly, controlled by the following:

· bank holding company· national bank· state member bank of the Federal Reserve System· state non-member bank· savings bank or association· credit union· or foreign bank






Disclosure Events

All firms registered to sell securities or provide investment advice are required to disclose regulatory actions, criminal orcivil judicial proceedings, and certain financial matters in which the firm or one of its control affiliates has been involved.For your convenience, below is a matrix of the number and status of disclosure events involving this brokerage firm orone of its control affiliates. Further information regarding these events can be found in the subsequent pages of thisreport.

Final On AppealPending

Regulatory Event 0 28 0

Civil Event 0 1 0

Arbitration N/A 12 N/A

Bond N/A 3 N/A






Disclosure Event Details

What you should know about reported disclosure events:

1. BrokerCheck provides details for any disclosure event that was reported in CRD. It also includessummary information regarding FINRA arbitration awards in cases where the brokerage firm wasnamed as a respondent.

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particular criminal event.3. Disclosure events in BrokerCheck reports come from different sources:

o Disclosure events for this brokerage firm were reported by the firm and/or regulators. When the firmand a regulator report information for the same event, both versions of the event will appear in theBrokerCheck report. The different versions will be separated by a solid line with the reporting sourcelabeled.

4. There are different statuses and dispositions for disclosure events: o A disclosure event may have a status of pending, on appeal, or final.

§ A "pending" event involves allegations that have not been proven or formally adjudicated.§ An event that is "on appeal" involves allegations that have been adjudicated but are currently

being appealed.§ A "final" event has been concluded and its resolution is not subject to change.

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§ A "resolved" matter usually involves no payment to the customer and no finding ofwrongdoing on the part of the individual broker. Such matters generally involve customerdisputes.

5. You may wish to contact the brokerage firm to obtain further information regarding any of thedisclosure events contained in this BrokerCheck report.

Regulatory - Final

This type of disclosure event involves (1) a final, formal proceeding initiated by a regulatory authority (e.g., a statesecurities agency, self-regulatory organization, federal regulator such as the U.S. Securities and Exchange Commission,foreign financial regulatory body) for a violation of investment-related rules or regulations; or (2) a revocation orsuspension of the authority of a brokerage firm or its control affiliate to act as an attorney, accountant or federalcontractor.

Disclosure 1 of 28

Reporting Source: Regulator

Allegations: ON JUNE 19, 2015 THE BUREAU RECEIVED A COMPLAINT FROM A NEWHAMPSHIRE RESIDENT AND FORMER CLIENT OF WADDELL, WHICHRAISED CONCERNS REGARDING CERTAIN FINANCIAL PLANNING FEESCHARGED BY A FINANCIAL ADVISOR OF WADDELL. BASED ON THECONTENT OF THE COMPLAINT, THE BUREAU INITIATED AN INVESTIGATION.DURING THE COURSE OF ITS INVESTIGATION, THE BUREAU DETERMINEDTHAT THE FINANCIAL ADVISOR IN QUESTION ENGAGED IN SEVERALVIOLATIONS OF NEW HAMPSHIRE SECURITIES LAW, INCLUDING VERBALLYMISREPRESENTING TO HIS CLIENTS THE NATURE OF FINANCIALPLANNING FEES HE CHARGED THOSE CLIENTS. THE BUREAU ALSONOTED CERTAIN DEFICIENCIES IN WADDELL'S SUPERVISION OF THEFINANCIAL ADVISOR. ALL OF THE BUREAU'S ALLEGATIONS AGAINSTWADDELL ARE LIMITED TO INVESTMENT ADVISORY ACTIVITIES.

Current Status: Final






Initiated By: NEW HAMPSHIRE BUREAU OF SECURITIES REGULATION

Principal Sanction(s)/ReliefSought:

Civil and Administrative Penalt(ies) /Fine(s)

Other Sanction(s)/ReliefSought:

Date Initiated: 06/19/2015

Docket/Case Number: C-2015000011

URL for Regulatory Action: HTTP://SOS.NH.GOV/ENFORCEACT.ASPX

Principal Product Type: Other

Other Product Type(s):

Allegations: ON JUNE 19, 2015 THE BUREAU RECEIVED A COMPLAINT FROM A NEWHAMPSHIRE RESIDENT AND FORMER CLIENT OF WADDELL, WHICHRAISED CONCERNS REGARDING CERTAIN FINANCIAL PLANNING FEESCHARGED BY A FINANCIAL ADVISOR OF WADDELL. BASED ON THECONTENT OF THE COMPLAINT, THE BUREAU INITIATED AN INVESTIGATION.DURING THE COURSE OF ITS INVESTIGATION, THE BUREAU DETERMINEDTHAT THE FINANCIAL ADVISOR IN QUESTION ENGAGED IN SEVERALVIOLATIONS OF NEW HAMPSHIRE SECURITIES LAW, INCLUDING VERBALLYMISREPRESENTING TO HIS CLIENTS THE NATURE OF FINANCIALPLANNING FEES HE CHARGED THOSE CLIENTS. THE BUREAU ALSONOTED CERTAIN DEFICIENCIES IN WADDELL'S SUPERVISION OF THEFINANCIAL ADVISOR. ALL OF THE BUREAU'S ALLEGATIONS AGAINSTWADDELL ARE LIMITED TO INVESTMENT ADVISORY ACTIVITIES.

Resolution Date: 12/05/2016

Resolution:

Other Sanctions Ordered: COSTS OF INVESTIGATION OF $300,000, CONTRIBUTION TO BUREAU'SINVESTOR EDUCATION FUND TOTALING $300,000, AND REFUNDS TOCLIENTS TOTALING $2,012,615.80

Sanction Details: FINE, COSTS, AND CONTRIBUTION TO INVESTOR EDUCATION FUND PAIDIN FULL UPON EXECUTION OF CONSENT ORDER.

Does the order constitute afinal order based onviolations of any laws orregulations that prohibitfraudulent, manipulative, ordeceptive conduct?

No

Sanctions Ordered: Monetary/Fine $300,000.00

Consent






iReporting Source: Firm

Initiated By: NEW HAMPSHIRE BUREAU OF SECURITIES REGULATION




RESTITUTIONUNDERTAKINGINVESTIGATION COSTSINVESTOR EDUCATION FUND CONTRIBUTION


Docket/Case Number: C-2015-000011

Principal Product Type: No Product


Allegations: ON JUNE 19, 2015 THE STATE OF NEW HAMPSHIRE, DEPARTMENT OFSTATE, BUREAU OF SECURITIES (THE "BUREAU")RECEIVED A COMPLAINTA COMPLAINT FROM A NEW HAMPSHIRE RESIDENT AND FORMER CLIENTOF APPLICANT, WHICH RAISED CONCERNS REGARDING CERTAINFINANCIAL PLANNING FEES CHARGED BY AN INDIVIDUAL INVESTMENTADVISOR REPRESENTATIVE OF THE APPLICANT. BASED ON THE CONTENTOF THE COMPLAINT, THE BUREAU INITIATED AN INVESTIGATION. DURINGTHE COURSE OF ITS INVESTIGATION, THE BUREAU DETERMINED THATTHE INDIVIDUAL INVESTMENT ADVISOR REPRESENTATIVE IN QUESTIONENGAGED IN SEVERAL VIOLATIONS OF NEW HAMPSHIRE SECURITIESLAW, INCLUDING VERBALLY MISREPRESENTING TO HIS CLIENTS THENATURE OF FINANCIAL PLANNING FEES HE CHARGED THOSE CLIENTS.THE BUREAU ALSO NOTED CERTAIN DEFICIENCIES IN APPLICANT'SSUPERVISION OF THE INVESTMENT ADVISOR REPRESENTATIVE INQUESTION. ALL OF THE BUREAU'S ALLEGATIONS AGAINST THE APPLICANTARE LIMITED TO ITS SUPERVISION OF THE INVESTMENT ADVISORYACTIVITIES OF THE INVESTMENT ADVISOR REPRESENTATIVE INQUESTION.



Resolution:

Other Sanctions Ordered: PAYMENT OF THE BUREAU'S INVESTIGATION COSTS IN THE AMOUNT OF$300,000; A $300,000 CONTRIBUTION TO THE BUREAU'S INVESTOREDUCATION FUND; AND VARIOUS UNDERTAKINGS REGARDING THESUPERVISION OF FINANCIAL PLANNING ACTIVITIES CONDUCTED BY ITSINVESTMENT ADVISOR REPRESENTATIVES.

Sanctions Ordered: Monetary/Fine $300,000.00Disgorgement/Restitution

Consent






Other Sanctions Ordered: PAYMENT OF THE BUREAU'S INVESTIGATION COSTS IN THE AMOUNT OF$300,000; A $300,000 CONTRIBUTION TO THE BUREAU'S INVESTOREDUCATION FUND; AND VARIOUS UNDERTAKINGS REGARDING THESUPERVISION OF FINANCIAL PLANNING ACTIVITIES CONDUCTED BY ITSINVESTMENT ADVISOR REPRESENTATIVES.

Sanction Details: COSTS OF INVESTIGATION ($300,000), ADMINISTRATIVE FINE ($300,000),INVESTOR EDUCATION FUND CONTRIBUTION ($300,000) AND RESTITUTION($2,012,616) LEVIED AGAINST APPLICANT WITH NO WAIVER; PAYMENT DUE120 DAYS AFTER 12/5/2016.

Firm Statement WITHOUT ADMITTING OR DENYING THE BUREAU'S ALLEGATIONS,APPLICANT ENTERED INTO A CONSENT ORDER ON DECEMBER 5, 2016, TORESOLVE THE MATTER. IN THE CONSENT ORDER, THE BUREAU NOTEDTHAT OVER THE PAST TWO YEARS, APPLICANT HAS TAKEN STEPS TOENHANCE ITS SUPERVISION OF THE FINANCIAL PLANNING CONDUCTEDBY ITS INVESTMENT ADVISOR REPRESENTATIVES AND APPLICANTAGREED THAT THESE ENHANCEMENTS WILL BE FINALIZED DURING THESECOND QUARTER OF 2017. PURSUANT TO APPLICANT'S FINANCIALPLANNING REFUND PROGRAM, APPLICANT AGREED TO REFUND APORTION OF CERTAIN FINANCIAL PLANNING FEES PAID BY THE CLIENTSOF THE INVESTMENT ADVISOR REPRESENTATIVE IN QUESTION, IN THEAMOUNT OF $2,012,615.80.

Disclosure 2 of 28

i


Allegations: SEC RULE 10B-10, FINRA RULE 2010, NASD RULE 2230: THE FIRM FAILEDTO DELIVER NUMEROUS PURCHASE CONFIRMATIONS FOR MUTUAL-FUNDASSET-ALLOCATION PRODUCTS ACCOUNTS (MAP), DURING A PERIOD,AND THOSE CONFIRMATIONS WOULD HAVE CONFIRMED MULTIPLEMUTUAL-FUND SHARE PURCHASES THAT OCCURRED IN NUMEROUSINVESTMENT-ADVISORY ACCOUNTS. ALTHOUGH THE FAILURE TO DELIVERPURCHASE CONFIRMATIONS RESULTED FROM THE ACTIONS OF A THIRD-PARTY SERVICE PROVIDER, THE FIRM REMAINED RESPONSIBLE AT ALLTIMES FOR COMPLIANCE WITH ITS OBLIGATIONS UNDER ALL APPLICABLESECURITIES LAWS AND REGULATIONS. THE FIRM'S INVESTMENT-ADVISORY OFFERINGS INCLUDE SEVERAL MAP ACCOUNTS. THE FIRMCONTRACTS WITH ITS SUBSIDIARY TO ACT AS THE TRANSFER AGENT FORTHE MUTUAL FUNDS THAT CAN BE HELD IN THE MAP ACCOUNTS AND THESUBSIDIARY WAS OBLIGATED TO SEND PURCHASE CONFIRMATIONS ONBEHALF OF THE FIRM TO MAP-ACCOUNT CUSTOMERS. THE FIRM'SSUBSIDIARY, IN TURN, CONTRACTS WITH A THIRD-PARTY SERVICEPROVIDER TO GENERATE AND DELIVER THOSE CONFIRMATIONS. UNTIL ACERTAIN DATE, ALL PURCHASE TRANSACTIONS IN MAP ACCOUNTSRESULTED IN THE DELIVERY OF CONTEMPORANEOUS TRADECONFIRMATIONS. ON THAT DATE, HOWEVER, THE THIRD-PARTY SERVICEPROVIDER MADE A CODING CHANGE TO THE SOFTWARE SYSTEM THAT ITPROVIDED TO THE SUBSIDIARY AND OTHER ENTITIES. THE THIRD-PARTYDID NOT INTEND FOR THE CODING CHANGE TO AFFECT THE MAPACCOUNTS IN ANY WAY, AND NEITHER THE SUBSIDIARY NOR THE FIRMREQUESTED THE CHANGE. NONETHELESS, ONE EFFECT OF THE CODINGCHANGE WAS TO PREVENT CUSTOMERS FROM RECEIVINGCONFIRMATIONS WHEN CASH IN A MAP ACCOUNT WAS ALLOCATED TOINDIVIDUAL MUTUAL FUNDS. THEREAFTER, A MAP-ACCOUNT CUSTOMERCONTACTED A REPRESENTATIVE OF THE FIRM TO ASK WHY THE FIRMWAS NO LONGER ISSUING FUND-ALLOCATION CONFIRMATIONS. THEREPRESENTATIVE CONTACTED THE SUBSIDIARY, BUT DID NOT ALERT THEFIRM'S COMPLIANCE DEPARTMENT OF THE SITUATION. THE SUBSIDIARYCONDUCTED AN INTERNAL REVIEW AND DETERMINED THAT THESUBSIDIARY'S CODING CHANGE HAD CREATED THE PROBLEM. THESUBSIDIARY ALSO DID NOT APPRISE THE FIRM'S COMPLIANCEDEPARTMENT OF THE SITUATION AT THAT TIME. THEREAFTER, THE THIRD-PARTY PROVIDER BEGAN RESEARCHING THE ISSUE AND WORKING ON ASOLUTION. THE INITIAL WORK DID NOT COMPLETELY SOLVE THEPROBLEM AND IT IMPLEMENTED A SECOND FIX, WHICH THROUGHSUBSEQUENT TESTING VERIFIED THAT THE PROBLEM WAS FULLYRESOLVED.







Initiated By: FINRA


Other


N/A


Docket/Case Number: 2011029075101

Principal Product Type: Mutual Fund(s)


SEC RULE 10B-10, FINRA RULE 2010, NASD RULE 2230: THE FIRM FAILEDTO DELIVER NUMEROUS PURCHASE CONFIRMATIONS FOR MUTUAL-FUNDASSET-ALLOCATION PRODUCTS ACCOUNTS (MAP), DURING A PERIOD,AND THOSE CONFIRMATIONS WOULD HAVE CONFIRMED MULTIPLEMUTUAL-FUND SHARE PURCHASES THAT OCCURRED IN NUMEROUSINVESTMENT-ADVISORY ACCOUNTS. ALTHOUGH THE FAILURE TO DELIVERPURCHASE CONFIRMATIONS RESULTED FROM THE ACTIONS OF A THIRD-PARTY SERVICE PROVIDER, THE FIRM REMAINED RESPONSIBLE AT ALLTIMES FOR COMPLIANCE WITH ITS OBLIGATIONS UNDER ALL APPLICABLESECURITIES LAWS AND REGULATIONS. THE FIRM'S INVESTMENT-ADVISORY OFFERINGS INCLUDE SEVERAL MAP ACCOUNTS. THE FIRMCONTRACTS WITH ITS SUBSIDIARY TO ACT AS THE TRANSFER AGENT FORTHE MUTUAL FUNDS THAT CAN BE HELD IN THE MAP ACCOUNTS AND THESUBSIDIARY WAS OBLIGATED TO SEND PURCHASE CONFIRMATIONS ONBEHALF OF THE FIRM TO MAP-ACCOUNT CUSTOMERS. THE FIRM'SSUBSIDIARY, IN TURN, CONTRACTS WITH A THIRD-PARTY SERVICEPROVIDER TO GENERATE AND DELIVER THOSE CONFIRMATIONS. UNTIL ACERTAIN DATE, ALL PURCHASE TRANSACTIONS IN MAP ACCOUNTSRESULTED IN THE DELIVERY OF CONTEMPORANEOUS TRADECONFIRMATIONS. ON THAT DATE, HOWEVER, THE THIRD-PARTY SERVICEPROVIDER MADE A CODING CHANGE TO THE SOFTWARE SYSTEM THAT ITPROVIDED TO THE SUBSIDIARY AND OTHER ENTITIES. THE THIRD-PARTYDID NOT INTEND FOR THE CODING CHANGE TO AFFECT THE MAPACCOUNTS IN ANY WAY, AND NEITHER THE SUBSIDIARY NOR THE FIRMREQUESTED THE CHANGE. NONETHELESS, ONE EFFECT OF THE CODINGCHANGE WAS TO PREVENT CUSTOMERS FROM RECEIVINGCONFIRMATIONS WHEN CASH IN A MAP ACCOUNT WAS ALLOCATED TOINDIVIDUAL MUTUAL FUNDS. THEREAFTER, A MAP-ACCOUNT CUSTOMERCONTACTED A REPRESENTATIVE OF THE FIRM TO ASK WHY THE FIRMWAS NO LONGER ISSUING FUND-ALLOCATION CONFIRMATIONS. THEREPRESENTATIVE CONTACTED THE SUBSIDIARY, BUT DID NOT ALERT THEFIRM'S COMPLIANCE DEPARTMENT OF THE SITUATION. THE SUBSIDIARYCONDUCTED AN INTERNAL REVIEW AND DETERMINED THAT THESUBSIDIARY'S CODING CHANGE HAD CREATED THE PROBLEM. THESUBSIDIARY ALSO DID NOT APPRISE THE FIRM'S COMPLIANCEDEPARTMENT OF THE SITUATION AT THAT TIME. THEREAFTER, THE THIRD-PARTY PROVIDER BEGAN RESEARCHING THE ISSUE AND WORKING ON ASOLUTION. THE INITIAL WORK DID NOT COMPLETELY SOLVE THEPROBLEM AND IT IMPLEMENTED A SECOND FIX, WHICH THROUGHSUBSEQUENT TESTING VERIFIED THAT THE PROBLEM WAS FULLYRESOLVED.


Resolution:


No

Acceptance, Waiver & Consent(AWC)





https://www.finra.org/industry/disciplinary-actions/finra-disciplinary-actions-online?search=2011029075101


Other Sanctions Ordered:

Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS,THEREFORE THE FIRM IS CENSURED AND FINED $75,000. FINE PAID INFULL ON 1/23/2013.

Sanctions Ordered: CensureMonetary/Fine $75,000.00


Allegations: FINRA ALLEGED THE FOLLOWING: THE FIRM (DUALLY REGISTERED WITHTHE SEC AS A BROKER-DEALER AND INVESTMENT ADVISER) VIOLATEDSEC RULE 10B-10, FINRA RULE 2010 AND NASD RULE 2230 BY FAILING TODELIVER NUMEROUS PURCHASE CONFIRMATIONS FOR MUTUAL FUNDASSET ALLOCATION PRODUCT ACCOUNTS DURING A CERTAIN TIMEPERIOD, AND THOSE CONFIRMATIONS WOULD HAVE CONFIRMEDMULTIPLE MUTUAL FUND SHARE PURCHASES THAT OCCURRED INNUMEROUS INVESTMENT ADVISORY ACCOUNTS. ALTHOUGH THE FAILURETO DELIVER PURCHASE CONFIRMATIONS RESULTED FROM THE ACTIONSOF A THIRD-PARTY SERVICE PROVIDER, THE FIRM REMAINEDRESPONSIBLE AT ALL TIMES FOR COMPLIANCE WITH ITS OBLIGATIONSUNDER ALL APPLICABLE SECURITIES LAWS AND REGULATIONS. THEFIRM'S INVESTMENT ADVISORY OFFERINGS INCLUDE SEVERAL MAPACCOUNTS. THE MUTUAL FUNDS HELD IN THE ADVISORY ACCOUNTSCONTRACT WITH A SUBSIDIARY OF THE FIRM TO ACT AS TRANSFERAGENT FOR THE FUNDS AND THE SUBSIDIARY WAS OBLIGATED TO SENDPURCHASE CONRFIRMATIONS ON BEHALF OF THE FIRM TO MAP ACCOUNTCUSTOMERS. THE FIRM'S SUBSIDIARY, IN TURN, CONTRACTS WITH ATHIRD-PARTY SERVICE PROVIDER TO GENERATE AND DELIVER THOSECONFIRMATIONS. UNTIL A CERTAIN DATE, ALL PURCHASE TRANSACTIONSIN MAP ACCOUNTS RESULTED IN THE DELIVERY OF CONTEMPORANEOUSTRADE CONFIRMATIONS. ON THAT DATE, HOWEVER, THE THIRD-PARTYSERVICE PROVIDER MADE A CODING CHANGE TO THE SOFTWARESYSTEM THAT IT PROVIDED TO THE SUBSIDIARY AND OTHER ENTITIES.THE THIRD-PARTY DID NOT INTEND FOR THE CODING CHANGE TO AFFECTTHE MAP ACCOUNTS IN ANY WAY, AND NEITHER THE SUBSIDIARY NORTHE FIRM REQUESTED THE CHANGE. NONETHELESS, ONE EFFECT OFTHE CODING CHANGE WAS TO PREVENT CUSTOMERS FROM RECEIVINGCONFIRMATIONS WHEN CASH IN A MAP ACCOUNT WAS ALLOCATED TOINDIVIDUAL MUTUAL FUNDS. THEREAFTER, A MAP ACCOUNT CUSTOMERCONTACTED A REPRESENTATIVE OF THE FIRM TO ASK WHY THE FIRMWAS NO LONGER ISSUING FUND-ALLOCATION CONFIRMATIONS. THEREPRESENTATIVE CONTACTED THE SUBSIDIARY, BUT DID NOT ALERT THEFIRM'S COMPLIANCE DEPARTMENT OF THE SITUATION. THE SUBSIDIARYCONDUCTED AN INTERNAL REVIEW AND DETERMINED THAT THE THIRD-PARTY'S CODING CHANGE HAD CREATED THE PROBLEM. THE SUBSIDIARYALSO DID NOT APPRISE THE FIRM'S COMPLIANCE DEPARTMENT OF THESITUATION AT THAT TIME. THEREAFTER, THE SUBSIDIARY BEGANRESEARCHING THE ISSUE AND WORKING ON A SOLUTION. THESUBSIDIARY'S INITIAL WORK DID NOT COMPLETELY SOLVE THE PROBLEMAND IT IMPLEMENTED A SECOND FIX, WHICH THROUGH SUBSEQUENTTESTING VERIFIED THAT THE PROBLEM WAS FULLY RESOLVED.







Initiated By: FINRA


Other


N/A





FINRA ALLEGED THE FOLLOWING: THE FIRM (DUALLY REGISTERED WITHTHE SEC AS A BROKER-DEALER AND INVESTMENT ADVISER) VIOLATEDSEC RULE 10B-10, FINRA RULE 2010 AND NASD RULE 2230 BY FAILING TODELIVER NUMEROUS PURCHASE CONFIRMATIONS FOR MUTUAL FUNDASSET ALLOCATION PRODUCT ACCOUNTS DURING A CERTAIN TIMEPERIOD, AND THOSE CONFIRMATIONS WOULD HAVE CONFIRMEDMULTIPLE MUTUAL FUND SHARE PURCHASES THAT OCCURRED INNUMEROUS INVESTMENT ADVISORY ACCOUNTS. ALTHOUGH THE FAILURETO DELIVER PURCHASE CONFIRMATIONS RESULTED FROM THE ACTIONSOF A THIRD-PARTY SERVICE PROVIDER, THE FIRM REMAINEDRESPONSIBLE AT ALL TIMES FOR COMPLIANCE WITH ITS OBLIGATIONSUNDER ALL APPLICABLE SECURITIES LAWS AND REGULATIONS. THEFIRM'S INVESTMENT ADVISORY OFFERINGS INCLUDE SEVERAL MAPACCOUNTS. THE MUTUAL FUNDS HELD IN THE ADVISORY ACCOUNTSCONTRACT WITH A SUBSIDIARY OF THE FIRM TO ACT AS TRANSFERAGENT FOR THE FUNDS AND THE SUBSIDIARY WAS OBLIGATED TO SENDPURCHASE CONRFIRMATIONS ON BEHALF OF THE FIRM TO MAP ACCOUNTCUSTOMERS. THE FIRM'S SUBSIDIARY, IN TURN, CONTRACTS WITH ATHIRD-PARTY SERVICE PROVIDER TO GENERATE AND DELIVER THOSECONFIRMATIONS. UNTIL A CERTAIN DATE, ALL PURCHASE TRANSACTIONSIN MAP ACCOUNTS RESULTED IN THE DELIVERY OF CONTEMPORANEOUSTRADE CONFIRMATIONS. ON THAT DATE, HOWEVER, THE THIRD-PARTYSERVICE PROVIDER MADE A CODING CHANGE TO THE SOFTWARESYSTEM THAT IT PROVIDED TO THE SUBSIDIARY AND OTHER ENTITIES.THE THIRD-PARTY DID NOT INTEND FOR THE CODING CHANGE TO AFFECTTHE MAP ACCOUNTS IN ANY WAY, AND NEITHER THE SUBSIDIARY NORTHE FIRM REQUESTED THE CHANGE. NONETHELESS, ONE EFFECT OFTHE CODING CHANGE WAS TO PREVENT CUSTOMERS FROM RECEIVINGCONFIRMATIONS WHEN CASH IN A MAP ACCOUNT WAS ALLOCATED TOINDIVIDUAL MUTUAL FUNDS. THEREAFTER, A MAP ACCOUNT CUSTOMERCONTACTED A REPRESENTATIVE OF THE FIRM TO ASK WHY THE FIRMWAS NO LONGER ISSUING FUND-ALLOCATION CONFIRMATIONS. THEREPRESENTATIVE CONTACTED THE SUBSIDIARY, BUT DID NOT ALERT THEFIRM'S COMPLIANCE DEPARTMENT OF THE SITUATION. THE SUBSIDIARYCONDUCTED AN INTERNAL REVIEW AND DETERMINED THAT THE THIRD-PARTY'S CODING CHANGE HAD CREATED THE PROBLEM. THE SUBSIDIARYALSO DID NOT APPRISE THE FIRM'S COMPLIANCE DEPARTMENT OF THESITUATION AT THAT TIME. THEREAFTER, THE SUBSIDIARY BEGANRESEARCHING THE ISSUE AND WORKING ON A SOLUTION. THESUBSIDIARY'S INITIAL WORK DID NOT COMPLETELY SOLVE THE PROBLEMAND IT IMPLEMENTED A SECOND FIX, WHICH THROUGH SUBSEQUENTTESTING VERIFIED THAT THE PROBLEM WAS FULLY RESOLVED.


Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS,THEREFORE THE FIRM IS CENSURED AND FINED $75,000.00.

Firm Statement THE FIRM DISCOVERED THE ISSUE, RESOLVED IT AND VOLUNTARILYSELF-REPORTED IT TO FINRA AND THE SEC. THE FIRM ALSO RETAINED ANINDEPENDENT CONSULTANT TO ENSURE THAT THE ISSUE WAS RESOLVEDAND IDENTIFY ANY CHANGES NECESSARY TO ITS INTERNAL CONTROLSTO PREVENT FUTURE ISSUES. THE CONSULTANT DETERMINED THAT THECAUSE OF THE ISSUE WAS BEYOND THE CONTROL OF THE FIRM ANDNOTED THAT THE FIRM HAD REASONABLE OVERSIGHT PROCEDURES,BUT IDENTIFIED SOME ENHANCEMENTS THAT THE FIRM HAS FULLYIMPLEMENTED.



Disclosure 3 of 28

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https://www.finra.org/industry/disciplinary-actions/finra-disciplinary-actions-online?search=2011029075101


Disclosure 3 of 28


Initiated By: OKLAHOMA DEPARTMENT OF SECURITIES


Censure


CIVIL PENALTY $25,000


Docket/Case Number: ODS FILE NO. 06-126

URL for Regulatory Action:



Allegations: WADDELL & REED FAILED TO ESTABLISH, MAINTAIN AND ENFORCEWRITTEN SUPERVISORY PROCEDURES TO PROPERLY SUPERVISEAGENTS DIRECTING DISTRIBUTIONS(A SERIES OF SUBSTANTIALLY EQUALPERIODIC PAYMENTS) FROM QUALIFIED RETIREMENT PLANS.



Resolution:


Sanction Details: CIVIL PENALTY TO BE PAID BY AUGUST 18, 2008. WADDELL & REED TOIMPLEMENT WRITTEN SUPERVISORY PROCEDURES AND COMPLIANCEGUIDELINES RELATING TO "SUBSTANTIALLY EQUAL PERIODIC PAYMENTS"AND CONDUCT TRAINING OF ITS AGENTS AND PRINCIPALS.


No


Consent








Initiated By: OKLAHOMA DEPARTMENT OF SECURITIES


Censure


CIVIL PENALTY $25,000


Docket/Case Number: ODS FILE NO. 06-126



Allegations: STATE ALLEGES THAT FIRM FAILED TO ESTABLISH, MAINTAIN ANDENFORCE WRITTEN SUPERVISORY PROCEDURES TO PROPERLYSUPERVISE AGENTS DIRECTING DISTRIBUTIONS (A SERIES OFSUBSTANTIALLY EQUAL PERIODIC PAYMENTS) FROM QUALIFIEDRETIREMENT PLANS


Resolution:

Other Sanctions Ordered: IMPLEMENT WRITTEN SUPERVISORY PROCEDURES AND COMPLIANCEGUIDELINES RELATING TO SECTION 72(T) OF INTERNAL REVENUE CODEAND PROVIDE ADDITIONAL TRAINING AS PART OF FIRM ELEMENT.

Sanction Details: $10,000 PAID ON 07/16/2008

Firm Statement WITHOUT ADMITTING OR DENYING ALLEGATIONS, FIRM AGREED TODESCRIBED SANCTIONS.


Settled

Disclosure 4 of 28

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Initiated By: NASD


Docket/Case Number: E062004029603

Allegations: NASD RULES 1031, 2110, 3010 - WADDELL & REED, INC. FAILED TO ENSURETHAT AN INDIVIDUAL DID NOT ENGAGE IN ANY ACTIVITIES REQUIRINGNASD REGISTRATION.






https://www.finra.org/industry/disciplinary-actions/finra-disciplinary-actions-online?search=e062004029603








Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE FINDINGS, THE FIRM CONSENTEDTO THE DESCRIBED SANCTIONS AND TO THE ENTRY OF FINDINGS;THEREFORE, IT IS CENSURED AND FINED $20,000.


No




Initiated By: NASD


Censure


FINE





Allegations: FIRM FAILED TO ENSURE THAT AN INDIVIDUAL DID NOT ENGAGE IN ANYACTIVITIES REQUIRING NASD REGISTRATION.










FINE


Resolution:


Sanction Details: $20,000.00 FINE PAID 12/14/2006.

Firm Statement WITHOUT ADMITTING OR DENYING FINDINGS, FIRM CONSENTED TOSANCTIONS AND ENTY OF FINDINGS.



Disclosure 5 of 28

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Reporting Source: Firm

Initiated By: KANSAS SECURITIES COMMISSIONER




N/A


Docket/Case Number: 2004E020 / 2004-4821


Other Product Type(s): N/A

Allegations: VIOLATIONS BY APPLICANT AND/OR CONTROL AFFILIATES OF K.S.A. 17-1253(A), 17-1253(B), 17-1254(M)(7), K.A.R. 81-3-1(I)(1) AND/OR 81-14-5(A).


Appealed To and Date AppealFiled:

N/A


Resolution:

Other Sanctions Ordered: N/A

Sanction Details: APPLICANT AND CONTROL AFFILIATES ORDERED TO JOINTLY PAY $2MILLION FINE WITHIN 30 DAYS OF SETTLEMENT.

Sanctions Ordered: Monetary/Fine $2,000,000.00

Settled






Sanction Details: APPLICANT AND CONTROL AFFILIATES ORDERED TO JOINTLY PAY $2MILLION FINE WITHIN 30 DAYS OF SETTLEMENT.

Firm Statement WITHOUT ADMITTING OR DENYING ALLEGATIONS, THE FIRM HASCONSENTED TO THE DESCRIBED SANTIONS AND THE ENTRY OFFINDINGS.

Disclosure 6 of 28

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Initiated By: NEW YORK ATTORNEY GENERAL


Undertaking


N/A


Docket/Case Number: NONE



Allegations: VIOLATIONS BY APPLICANT OF THE MARTIN ACT, ARTICLE 23-A OF THEGENERAL BUSINESS LAW, SECTION 349 OF THE GENERAL BUSINESS LAWAND SECTION 63(12) OF THE EXECUTIVE LAW OF THE STATE OF NEWYORK.



N/A


Resolution:

Other Sanctions Ordered: COMPLIANCE UNDERTAKINGS AND MUTUAL FUND MANAGEMENT FEEREDUCTIONS.

Sanction Details: APPLICANT AGREED THAT A CONTROL AFFILIATE WILL REDUCE MUTUALFUND MANAGEMENT FEES BY $5 MILLION EACH YEAR FOR THE FIVEYEARS FOLLOWING SETTLEMENT.


Sanctions Ordered:

Settled






Disclosure 7 of 28

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Initiated By: UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Docket/Case Number: FILE NO. 3-12372


Allegations: SEC ADMIN. PROCEEDING RELEASE NO.S 34-54193, 40-2537 AND 40-27424DATED JULY 24, 2006; WADDELL & REED, INC. ("W&R") WILLFULLY AIDEDAND ABETTED AND CAUSED VIOLATIONS OF SECTIONS 206(1) AND 206(2).W&R KNOWINGLY AND SUBSTANTIALLY ASSISTED A SUBSIDIARY'SVIOLATIONS BY NEGOTIATING TIMING AGREEMENTS, FROM WHICH THEYFINANCIALLY BENEFITED, THAT CAUSED THE SUBSIDIARY TO BREACH ITSFIDUCIARY DUTY TO THE FUNDS' BOARD AND DEFRAUD THE FUNDS'SHAREHOLDERS. SPECIFICALLY, W&R RECEIVED FEES FROM THREETIMERS IN RETURN FOR TIMING CAPACITY IN THE FUNDS, ANDSUBSIDIARY PERMITTED THE TIMING WHICH FINANCIALLY BENEFITED ITSAFFILIATES. RESPONDENT, AN AFFILIATED PERSON OF THE TIMED FUNDS,WILLFULLY VIOLATED SECTION 17(D) OF THE INVESTMENT COMPANY ACTAND RULE 17D-1 THEREUNDER, IN THAT, WHILE ACTING AS A PRINCIPAL,EACH OF THEM PARTICIPATED IN AND EFFECTED TRANSACTIONS INCONNECTION WITH JOINT ARRANGEMENTS IN WHICH THE FUNDS WEREPARTICIPANTS, WITHOUT FILING AN APPLICATION WITH THE SEC ANDOBTAINING A SEC ORDER APPROVING THE TRANSACTIONS. PURSUANT TOWRITTEN AGREEMENTS, THE RESPONDENTS PERMITTED A NUMBER OFINDIVIDUALS AND ENTITIES TO MARKET TIME CERTAIN FUNDS IN AMUTUAL FUND COMPLEX ("FUNDS"), SUBJECT TO CERTAIN LIMITATIONSON THE NUMBER, AMOUNT AND FREQUENCY OF TRADES, FROM AT LEASTAS EARLY AS 1995 THROUGH 2003 BEGINNING IN DECEMBER 1998 ANDCONTINUING THROUGH THE FALL OF 2003, W&R COLLECTED A TOTAL OF$3.6 MILLION IN ASSET-BASED FEES FROM THREE OF THESE TIMERSPURSUANT TO TIMING AGREEMENTS WITH THOSE ENTITIES. DURING THERELEVANT PERIOD, RESPONDENT HAD INTERNAL PROCEDURESDESIGNED TO PREVENT OR LIMIT MARKET TIMING, AND THE FUNDS HADPROSPECTUS DISCLOSURES THAT FOSTERED THE IMPRESSION THAT THEFUNDS DISCOURAGED TIMING. RESPONDENT PERMITTED THE FEEPAYING TIMERS TO TIME CERTAIN FUNDS, AND THEY PERMITTED TIMERS,INCLUDING THE FEE PAYING TIMERS, TO TIME IN THE AN INTERNATIONALFUND, EVEN THOUGH THEY KNEW THAT THE TIMERS WERE HARMINGTHAT FUND BY DILUTING OTHER INVESTORS' RETURNS.












Resolution:

Other Sanctions Ordered: UNDERTAKINGS: COMPLIANCE AND ETHICS OVERSIGHT STRUCTURE;EACH RESPONDENT HAS UNDERTAKEN TO MAINTAIN ITS OWNCOMPLIANCE AND ETHICS OVERSIGHT INFRASTRUCTURE HAVING THEFOLLOWING CHARACTERISTICS: INDEPENDENT COMPLIANCECONSULTANTS; RESPONDENTS SHALL RETAIN, WITHIN 30 DAYS OF THEDATE OF ENTRY OF THE ORDER, THE SERVICES OF AN INDEPENDENTCOMPLIANCE CONSULTANT ("THE ADVISER CONSULTANT") NOTUNACCEPTABLE TO THE STAFF OF THE COMMISSION AND A MAJORITY OFTHE INDEPENDENT DIRECTORS OF THE WADDELL & REED ADVISORSFUNDS. COMPLIANCE REVIEW; WITHIN TWO YEARS, BUT IN NO EVENTEARLIER THAN ONE YEAR, AFTER THE COMPLETION OF THEINDEPENDENT COMPLIANCE CONSULTANT, RESPONDENTS SHALLUNDERGO A COMPLIANCE REVIEW BY A THIRD PARTY, WHO IS NOT ANINTERESTED PERSON, AS DEFINED IN THE INVESTMENT COMPANY ACT,OF RESPONDENTS. INDEPENDENT DISTRIBUTION CONSULTANT;RESPONDENTS SHALL RETAIN, WITHIN 30 DAYS OF THE DATE OF ENTRYOF THE ORDER, THE SERVICES OF AN INDEPENDENT DISTRIBUTIONCONSULTANT NOT UNACCEPTABLE TO THE STAFF OF THE COMMISSIONAND THE INDEPENDENT DIRECTORS OF THE FUNDS. CERTIFICATION; NOLATER THAN TWENTY-FOUR MONTHS AFTER THE DATE OF ENTRY OF THEORDER, THE CHIEF EXECUTIVE OFFICER OF EACH OF THE RESPONDENTSSHALL CERTIFY TO THE COMMISSION IN WRITING THAT THE RESPECTIVERESPONDENT HAS FULLY ADOPTED AND COMPLIED IN ALL MATERIALRESPECTS WITH THE UNDERTAKINGS AND WITH THE RECOMMENDATIONSOF THE INDEPENDENT COMPLIANCE CONSULTANTS OR, IN THE EVENT OFMATERIAL NON-ADOPTION OR NON-COMPLIANCE, SHALL DESCRIBE SUCHMATERIAL NON-ADOPTION AND NON-COMPLIANCE. RECORDKEEPING;RESPONDENTS SHALL PRESERVE FOR A PERIOD NOT LESS THAN SIXYEARS FROM THE END OF THE FISCAL YEAR LAST USED, THE FIRST TWOYEARS IN AN EASILY ACCESSIBLE PLACE, ANY RECORD OFRESPONDENTS' COMPLIANCE WITH THE UNDERTAKINGS.


No

Sanctions Ordered: CensureMonetary/Fine $10,000,000.00Disgorgement/RestitutionCease and Desist/Injunction

Order






UNDERTAKINGS: COMPLIANCE AND ETHICS OVERSIGHT STRUCTURE;EACH RESPONDENT HAS UNDERTAKEN TO MAINTAIN ITS OWNCOMPLIANCE AND ETHICS OVERSIGHT INFRASTRUCTURE HAVING THEFOLLOWING CHARACTERISTICS: INDEPENDENT COMPLIANCECONSULTANTS; RESPONDENTS SHALL RETAIN, WITHIN 30 DAYS OF THEDATE OF ENTRY OF THE ORDER, THE SERVICES OF AN INDEPENDENTCOMPLIANCE CONSULTANT ("THE ADVISER CONSULTANT") NOTUNACCEPTABLE TO THE STAFF OF THE COMMISSION AND A MAJORITY OFTHE INDEPENDENT DIRECTORS OF THE WADDELL & REED ADVISORSFUNDS. COMPLIANCE REVIEW; WITHIN TWO YEARS, BUT IN NO EVENTEARLIER THAN ONE YEAR, AFTER THE COMPLETION OF THEINDEPENDENT COMPLIANCE CONSULTANT, RESPONDENTS SHALLUNDERGO A COMPLIANCE REVIEW BY A THIRD PARTY, WHO IS NOT ANINTERESTED PERSON, AS DEFINED IN THE INVESTMENT COMPANY ACT,OF RESPONDENTS. INDEPENDENT DISTRIBUTION CONSULTANT;RESPONDENTS SHALL RETAIN, WITHIN 30 DAYS OF THE DATE OF ENTRYOF THE ORDER, THE SERVICES OF AN INDEPENDENT DISTRIBUTIONCONSULTANT NOT UNACCEPTABLE TO THE STAFF OF THE COMMISSIONAND THE INDEPENDENT DIRECTORS OF THE FUNDS. CERTIFICATION; NOLATER THAN TWENTY-FOUR MONTHS AFTER THE DATE OF ENTRY OF THEORDER, THE CHIEF EXECUTIVE OFFICER OF EACH OF THE RESPONDENTSSHALL CERTIFY TO THE COMMISSION IN WRITING THAT THE RESPECTIVERESPONDENT HAS FULLY ADOPTED AND COMPLIED IN ALL MATERIALRESPECTS WITH THE UNDERTAKINGS AND WITH THE RECOMMENDATIONSOF THE INDEPENDENT COMPLIANCE CONSULTANTS OR, IN THE EVENT OFMATERIAL NON-ADOPTION OR NON-COMPLIANCE, SHALL DESCRIBE SUCHMATERIAL NON-ADOPTION AND NON-COMPLIANCE. RECORDKEEPING;RESPONDENTS SHALL PRESERVE FOR A PERIOD NOT LESS THAN SIXYEARS FROM THE END OF THE FISCAL YEAR LAST USED, THE FIRST TWOYEARS IN AN EASILY ACCESSIBLE PLACE, ANY RECORD OFRESPONDENTS' COMPLIANCE WITH THE UNDERTAKINGS.

Sanction Details: RESPONDENT HAS SUBMITTED AN OFFER OF SETTLEMENT WITHOUTADMITTING OR DENYING THE FINDINGS, RESPONDENT CONSENTS TO THEENTRY OF THIS ORDER INSTITUTING ADMINISTRATIVE AND CEASE-AND-DESIST PROCEEDINGS. ACCORDINGLY, IT IS ORDERED, EFFECTIVEIMMEDIATELY, THAT: PURSUANT TO SECTION 15(B)(4) OF THE EXCHANGEACT, W&R IS HEREBY CENSURED. PURSUANT TO SECTION 203(K) OF THEADVISERS ACT AND SECTION 9(F) OF THE INVESTMENT COMPANY ACT,W&R SHALL CEASE AND DESIST FROM COMMITTING OR CAUSING ANYVIOLATIONS AND ANY FUTURE VIOLATIONS OF SECTIONS 206(1) AND206(2) OF THE ADVISERS ACT AND SECTION 17(D) OF THE INVESTMENTCOMPANY ACT AND RULE 17D-1 THEREUNDER. RESPONDENT SHALL PAY,WITHIN 20 DAYS OF THE ENTRY OF THIS ORDER, ON A JOINT ANDSEVERAL BASIS, $40 MILLION IN DISGORGEMENT PLUS A CIVIL MONEYPENALTY OF $10 MILLION, FOR A TOTAL PAYMENT OF $50 MILLION.RESPONDENT MUST COMPLY WITH THE UNDERTAKINGS.


Initiated By: SECURITIES AND EXCHANGE COMMISSION


Docket/Case Number: 3-12372

Allegations: AIDING AND ABETTING OF VIOLATIONS BY A CONTROL AFFILIATE OFSECTIONS 206(1) AND 206(2) OF THE INVESTMENT ADVISERS ACT INALLOWING CERTAIN FUND SHAREHOLDERS TO ENGAGE IN FREQUENTTRADING OF FUND SHARES IN EXCHANGE FOR PAYMENTS TO APPLICANTAND ANOTHER CONTROL AFFILIATE. VIOLATIONS OF SECTION 17(D) OFTHE INVESTMENT COMPANY ACT AND RULE 17D-1 BY PARTICIPATING INAND EFFECTING TRANSACTIONS IN CONNECTION WITH JOINTARRANGEMENTS IN WHICH THE FUNDS WERE PARTICIPANTS WITHOUTAPPROVAL FROM THE SEC.



N/A







Censure


CEASE AND DESIST, DISGORGEMENT, FINE, COMPLIANCE UNDERTAKINGS




Resolution:

Other Sanctions Ordered: COMPLIANCE UNDERTAKINGS

Sanction Details: APPLICANT AND CONTROL AFFILIATES ORDERED TO JOINTLY PAY $40MILLION IN DISGORGEMENT AND $10 MILLION IN CIVIL PENALTY WITHIN 20DAYS OF SETTLEMENT.


Sanctions Ordered: CensureMonetary/Fine $10,000,000.00Disgorgement/RestitutionCease and Desist/Injunction

Settled

Disclosure 8 of 28

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Initiated By: DISTRICT OF COLUMBIA


Docket/Case Number: SB-05-04

Allegations: FAILED TO ENSURE THAT RECOMMENDATIONS THAT CUSTOMERSEXCHANGE VARIABLE ANNUITIES WERE SUITABLE FOR THOSECUSTOMERS, IN VIOLATION OF DISTRICT OF COLUMBIA CODE 31-5605.02(A)(1)(B); ENGAGED IN DISHONEST OR UNETHICAL PRACTICES IN THEEXCHANGE OF CUSTOMERS' VARIABLE ANNUITIES IN VIOLATION OF D.C.,OFFICIAL CODE 31-5602 07 (A)(9);FAILED REASONABLY TO SUPERVISE ITS FINANCIAL ADVISORS OREMPLOYEES, IN VIOLATION OF D.C.. OFFICIAL CODE 31-5602.07 (A)(12);EXHIBITED FINANCIAL IRRESPONSIBILITY, BY WHICH THE DISTRICT OFCOLUMBIA COULD BRING DISCIPLINARY PROCEEDINGS BASED ONVIOLATIONS OF D C. OFFICIAL CODE 31.








Other


ADMINISTRATIVE CONSENT ORDER



Principal Product Type: Annuity(ies) - Variable



Resolution:


Sanction Details: AS A RESULT OF THE FINDINGS OF FACT AND CONCLUSIONS OF LAWCONTAINED IN THIS ORDER AND THE NASD ORDER, THE FIRM SHALL,AMONG OTHER THINGS, ESTABLISH A FUND IN THE AMOUNT OF $11MILLION, WHICH FUND SHALL BE USED TO COMPENSATE CUSTOMERS.RETAIN AN INDEPENDENT CONSULTANT NOT UNACCEPTABLE TO THENASD AND THE STATES, TO IMPLEMENT THE DISTRIBUTION. THE FIRMSHALL COOPERATE FULLY WITH THE CONSULTANT AND SHALL NOT PLACERESTRICTIONS ON THE CONSULTANT'S COMMUNICATIONS WITH STAFF OFTHE DISTRICT OF COLUMBIA'S DEPARTMENT OF INSURANCE, SECURITIESAND BANKING.

Regulator Statement THE TOTAL AMOUNT PAID CONSTITUTES THE DISTRICT OF COLUMBIA'SPROPORTIONATE SHARE OF THE STATE SETTLEMENT AMOUNT OF TWOMILLION DOLLARS ($2,000,000). THIS AMOUNT SHALL BE PAID TO THEDISTRICT OF COLUMBIA DEPARTMENT OF INSURANCE, SECURITIES ANDBANKING WITHIN TEN (10) DAYS OF THE ENTRY OF THIS ORDER. ANYAMOUNTS OF THIS $2 MILLION PENALTY FOR THE STATES THAT REMAINSON OCTOBER 31, 2005, BASED ON ANY STATES DECIDING NOT TO JOINTHE MULTI-STATE SETTLEMENT IN THIS MATTER, WILL BE ALLOCATEDPROPORTIONATELY AMONG THE STATES PARTICIPATING IN THISSETTLEMENT (BASED ON THE NUMBER OF EXCHANGES IN EACH STATE)AND PAID TO THESE STATES BY DECEMBER 31, 2005..


No


Order






THE TOTAL AMOUNT PAID CONSTITUTES THE DISTRICT OF COLUMBIA'SPROPORTIONATE SHARE OF THE STATE SETTLEMENT AMOUNT OF TWOMILLION DOLLARS ($2,000,000). THIS AMOUNT SHALL BE PAID TO THEDISTRICT OF COLUMBIA DEPARTMENT OF INSURANCE, SECURITIES ANDBANKING WITHIN TEN (10) DAYS OF THE ENTRY OF THIS ORDER. ANYAMOUNTS OF THIS $2 MILLION PENALTY FOR THE STATES THAT REMAINSON OCTOBER 31, 2005, BASED ON ANY STATES DECIDING NOT TO JOINTHE MULTI-STATE SETTLEMENT IN THIS MATTER, WILL BE ALLOCATEDPROPORTIONATELY AMONG THE STATES PARTICIPATING IN THISSETTLEMENT (BASED ON THE NUMBER OF EXCHANGES IN EACH STATE)AND PAID TO THESE STATES BY DECEMBER 31, 2005..


Initiated By: DISTRICT OF COLUMBIA


Other


ADMINISTRATIVE CONSENT ORDER





Allegations: ON APRIL 29, 2005, WADDELL & REED AGREED WITH A MULTISTATECONSORTIUM TO A GLOBAL RESOLUTION OF STATE CLAIMS ARISINGFROM THE SETTLEMENT WITH THE NASD DEPARTMENT OFENFORCEMENT ("DOE") OF A REGULATORY ACTION BROUGHT BY THE DOEON JANUARY 14, 2004 (CASE NO. CAF040002) ALLEGING THAT WADDELL &REED VIOLATED NASD CONDUCT RULES 2110, 2310, 3010 AND 3110 AND17(A)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 AND RULE 17A-3(A)(6) THEREUNDER, RELATING TO EXCHANGES MADE BY CERTAIN OFITS CLIENTS OF THEIR VARIABLE ANNUITY POLICIES. THE DOE ALLEGEDTHAT WADDELL & REED FAILED TO TAKE ADEQUATE STEPS TODETERMINE WHETHER THERE WERE REASONABLE GROUNDS FOR THECLIENTS TO ENTER INTO THE EXCHANGES, SUCH AS DETERMININGWHETHER THE CUSTOMERS WERE LIKELY TO BENEFIT OR LOSE MONEYFROM THE EXCHANGES, FAILED TO ESTABLISH SUFFICIENT GUIDANCEFOR THE SALES FORCE TO USE IN DETERMINING THE SUITABILITY OF THEEXCHANGES, FAILED TO ESTABLISH AND MAINTAIN SUPERVISORYPROCEDURES OR A SYSTEM TO SUPERVISE THE ACTIVITIES OF ITSADVISORS THAT WAS REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH THE REQUIREMENTS OF THE NASD'S SUITABILITY RULE, AND FAILEDTO MAINTAIN BOOKS AND RECORDS REGARDING ORDERS FORUNEXECUTED VARIABLE ANNUITY EXCHANGES. WITHOUT ADMITTING ORDENYING THE ALLEGATIONS, WADDELL & REED AGREED TO, IN ADDITIONTO THE DOE SETTLEMENT, PAY A FINE OF $2 MILLION AND PAY ADDITIONALCLIENT RESTITUTION.



Resolution: Order








Sanction Details: FINE PAID



Disclosure 9 of 28

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Initiated By: FLORIDA


Cease and Desist



Docket/Case Number: 0220-S-7/05




Allegations: SUITABUILTY, 'SWITCHING" AND SALES PRACTICES IN THE SALE OFANNUITIES.



Resolution:



No

Sanctions Ordered: Monetary/Fine $16,904.13Cease and Desist/Injunction

Stipulation and Consent







Sanction Details: NA

Regulator Statement SUITABUILTY, 'SWITCHING" AND SALES PRACTICES IN THE SALE OFANNUITIES. FAILURE TO SUPERVISE AND DECEITFUL TRANSACTIONS.


Initiated By: FLORIDA


Cease and Desist















Resolution:


Sanction Details: N/A

Firm Statement WITHOUT ADMITTING OR DENYING ALLEGATIONS, THE FIRM HASCONSENTED TO THE DESCRIBED SANCTIONS AND THE ENTRY OFFINDINGS.

Sanctions Ordered: Monetary/Fine $16,904.13Cease and Desist/Injunction


Disclosure 10 of 28

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Initiated By: STATE OF MISSOURI, OFFICE OF SECRETARY OF STATE


Cease and Desist


CIVIL MONETARY FINES, RESTITUTION, PAYMENT OF INVESTIGATIVECOSTS


Docket/Case Number: AP-06-03



Allegations: FAILURE TO SUPERVISE



Resolution:

Other Sanctions Ordered: PAYMENT OF INVESTIGATIVE COSTS

Sanction Details: RESTITUTION OF $90,361.49, CIVIL PENALTY OF $75,000.00 ANDINVESTIGATION FEES OF $6,800.00, PAYABLE WITHIN TEN (10) DAYS OFCONSENT.

Sanctions Ordered: Monetary/Fine $75,000.00Disgorgement/RestitutionCease and Desist/Injunction

Consent






Sanction Details: RESTITUTION OF $90,361.49, CIVIL PENALTY OF $75,000.00 ANDINVESTIGATION FEES OF $6,800.00, PAYABLE WITHIN TEN (10) DAYS OFCONSENT.

Firm Statement WITHOUT ADMITTING OR DENYING THE SECURITIES DIVISION'SALLEGATIONS, THE FIRM AGREED TO ENTER INTO THE CONSENT ORDERTO RESOLVE THE MATTER.

Disclosure 11 of 28

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Initiated By: WISCONSIN


Prohibition



Docket/Case Number: S-05048




Allegations: CONSENT ORDER OF PROHIBITION WAS ENTERED INTO JOINTLY WITHTHE OFFICE OF THE COMMISSIONER OF INSURANCE BASED ONUNSUITABLE RECOMMENDATIONS IN THE OFFER AND SALE OF VARIABLEANNUITIES. THIS WAS PART OF A NATIONWIDE SETTLEMENT AGAINST THEFIRM.



Resolution:


Sanction Details: $45726.95


No


Order






Sanction Details: $45726.95

Regulator Statement CONSENT ORDER OF PROHIBITION WAS ENTERED INTO JOINTLY WITHTHE OFFICE OF THE COMMISSIONER OF INSURANCE BASED ONUNSUITABLE RECOMMENDATIONS IN THE OFFER AND SALE OF VARIABLEANNUITIES. THIS WAS PART OF A NATIONWIDE SETTLEMENT AGAINST THEFIRM.


Initiated By: WISCONSIN


Other


Docket/Case Number: S-05048











Other


FINE


Resolution:


Sanction Details: FINE DETAIL

Firm Statement WITHOUT ADMITTING OR DENYING ALLEGATIONS, THE FIRM HASCONSENTED TO THE DESCRIBED SANCTIONS AND THE ENTRY OFFINDINGS.


Consent

Disclosure 12 of 28

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Initiated By: TEXAS


Reprimand


CIVIL MONETARY PENALTY FINE


Docket/Case Number: IC05-CAF-30




Allegations: WADDELL & REED ENGAGED IN UNSUITABLE SWITCHES BETWEENVARIABLE ANNUITIES WITH RESPECT TO MANY OF ITS CLIENTS,INCLUDING RESIDENTS OF TEXAS, WHICH CONSTITUTES INEQUITABLEPRACTICE PURSUANT TO SECTION 14.A(3) OF THE TEXAS SECURITIESACT. WADDELL & REED FAILED TO REASONABLY SUPERVISE ITSFINANCIAL ADVISORS OR EMPLOYEES, IN VIOLATION OF SECTION 115.10OF THE BOARD RULES.


Resolution: Order41©2018 FINRA. All rights reserved. Report about WADDELL & REED






Resolution:

Other Sanctions Ordered: REPRIMAND

Sanction Details: PURSUANT TO SECTION 23-1 OF THE TEXAS SECURITIES ACT, WADDELL &REED SHALL PAY THE STATE OF TEXAS AN AMOUNT OF AT LEAST$54,011.90, TO BE DEPOSITED INTO THE GENERAL REVENUE FUND,PURUSANT TO SECTION 36 OF THE TEXAS SECURITIES ACT.


No


Order









Initiated By: TEXAS


Other


FINE


Docket/Case Number: IC05-CAF-30



ON APRIL 29, 2005, WADDELL & REED AGREED WITH A MULTISTATECONSORTIUM TO A GLOBAL RESOLUTION OF STATE CLAIMS ARISINGFROM THE SETTLEMENT WITH THE NASD DEPARTMENT OFENFORCEMENT ("DOE") OF A REGULATORY ACTION BROUGHT BY THE DOEON JANUARY 14, 2004 (CASE NO. CAF040002) ALLEGING THAT WADDELL &REED VIOLATED NASD CONDUCT RULES 2110, 2310, 3010 AND 3110 AND17(A)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 AND RULE 17A-3(A)(6) THEREUNDER, RELATING TO EXCHANGES MADE BY CERTAIN OFITS CLIENTS OF THEIR VARIABLE ANNUITY POLICIES. THE DOE ALLEGEDTHAT WADDELL & REED FAILED TO TAKE ADEQUATE STEPS TODETERMINE WHETHER THERE WERE REASONABLE GROUNDS FOR THECLIENTS TO ENTER INTO THE EXCHANGES, SUCH AS DETERMININGWHETHER THE CUSTOMERS WERE LIKELY TO BENEFIT OR LOSE MONEYFROM THE EXCHANGES, FAILED TO ESTABLISH SUFFICIENT GUIDANCEFOR THE SALES FORCE TO USE IN DETERMINING THE SUITABILITY OF THEEXCHANGES, FAILED TO ESTABLISH AND MAINTAIN SUPERVISORYPROCEDURES OR A SYSTEM TO SUPERVISE THE ACTIVITIES OF ITSADVISORS THAT WAS REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH THE REQUIREMENTS OF THE NASD'S SUITABILITY RULE, AND FAILEDTO MAINTAIN BOOKS AND RECORDS REGARDING ORDERS FORUNEXECUTED VARIABLE ANNUITY EXCHANGES. WITHOUT ADMITTING ORDENYING THE ALLEGATIONS, WADDELL & REED AGREED TO, IN ADDITIONTO THE DOE SETTLEMENT, PAY A FINE OF $2 MILLION AND PAY ADDITIONALCLIENT RESTITUTION.


Resolution:

Other Sanctions Ordered: REPRIMAND




Consent

Disclosure 13 of 28

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Initiated By: NORTH DAKOTA



Docket/Case Number:




Allegations: RESPONDENT ENGAGED IN UNSUITABLE SWITCHES BETWEEN VARIABLEANNUITIES WITH RESPECT TO MANY OF ITS CLIENTS, INCLUDINGRESIDENTS OF NORTH DAKOTA.










Resolution:


Sanction Details: CIVIL PENALTY PAID.


No


Consent









Initiated By: NORTH DAKOTA


Other


FINE


Docket/Case Number: NONE



ON APRIL 29, 2005, WADDELL & REED AGREED WITH A MULTISTATECONSORTIUM TO A GLOBAL RESOLUTION OF STATE CLAIMS ARISINGFROM THE SETTLEMENT WITH THE NASD DEPARTMENT OFENFORCEMENT ("DOE") OF A REGULATORY ACTION BROUGHT BY THE DOEON JANUARY 14, 2004 (CASE NO. CAF040002) ALLEGING THAT WADDELL &REED VIOLATED NASD CONDUCT RULES 2110, 2310, 3010 AND 3110 AND17(A)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 AND RULE 17A-3(A)(6) THEREUNDER, RELATING TO EXCHANGES MADE BY CERTAIN OFITS CLIENTS OF THEIR VARIABLE ANNUITY POLICIES. THE DOE ALLEGEDTHAT WADDELL & REED FAILED TO TAKE ADEQUATE STEPS TODETERMINE WHETHER THERE WERE REASONABLE GROUNDS FOR THECLIENTS TO ENTER INTO THE EXCHANGES, SUCH AS DETERMININGWHETHER THE CUSTOMERS WERE LIKELY TO BENEFIT OR LOSE MONEYFROM THE EXCHANGES, FAILED TO ESTABLISH SUFFICIENT GUIDANCEFOR THE SALES FORCE TO USE IN DETERMINING THE SUITABILITY OF THEEXCHANGES, FAILED TO ESTABLISH AND MAINTAIN SUPERVISORYPROCEDURES OR A SYSTEM TO SUPERVISE THE ACTIVITIES OF ITSADVISORS THAT WAS REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH THE REQUIREMENTS OF THE NASD'S SUITABILITY RULE, AND FAILEDTO MAINTAIN BOOKS AND RECORDS REGARDING ORDERS FORUNEXECUTED VARIABLE ANNUITY EXCHANGES. WITHOUT ADMITTING ORDENYING THE ALLEGATIONS, WADDELL & REED AGREED TO, IN ADDITIONTO THE DOE SETTLEMENT, PAY A FINE OF $2 MILLION AND PAY ADDITIONALCLIENT RESTITUTION.


Resolution:



Firm Statement WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, THE FIRM HASCONSENTED TO THE DESCRIBED SANCTIONS AND THE ENTRY OFFINDINGS.


Consent

Disclosure 14 of 28

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Initiated By: MONTANA STATE AUDITOR


Cease and Desist



Docket/Case Number: 07-14-05-147-I



Allegations: POSSIBLE BOOKS AND RECORDS DEFICIENCIES AT BRANCH OFFICE.









Resolution:


Sanction Details: WITHOUT ADMITTING THE STATE'S ALLEGATIONS, THE FIRM AGREED TOPAY A FINE TO RESOLVE THE MATTER.


Consent

Disclosure 15 of 28

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Initiated By: KANSAS COMMISSIONER OF INSURANCE


Docket/Case Number: 3468-CO









Other


FINE

Docket/Case Number: 3468-CO




Resolution:


Sanction Details: FINE TO BE PAID TO EACH STATE WITHIN 10 DAYS AFTER RECEIPT OFSIGNED CONSENT.

Firm Statement WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, THE FIRM HASCONSENTED TO THE DESCRIBED SANCTIONS AND THE ENTRY OFFINDINGS.

Sanctions Ordered: Monetary/Fine $2,000,000.00Disgorgement/Restitution

Consent

Disclosure 16 of 28

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Initiated By: MONTANA STATE AUDITOR


Restitution


FINE AND/OR REVOCATION/SUSPENSION


Docket/Case Number: 03-31-05-142 I



Allegations: ALLEGED VIOLATIONS OF MONTANA SECURITIES ACT AND THE MONTANAINSURANCE CODE IN CONNECTION WITH VARIABLE ANNUITY EXCHANGESFROM APRIL 2000 TO AUGUST 2002.


Resolution: Settled 47©2018 FINRA. All rights reserved. Report about WADDELL & REED






Resolution:

Other Sanctions Ordered: $25,000.00 CONTRIBUTION TO INVESTOR PROTECTION TRUST.

Sanction Details: WITHOUT ADMITTING THE STATE'S ALLEGATIONS, THE FIRM AGREED TOPAY A FINE RELATED TO NON-SECURITIES ALLEGATIONS INVOLVINGINSURANCE AGENCY REGISTRATION ISSUES.


Settled

Disclosure 17 of 28

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Initiated By: COMMISSIONER OF SECURITIES, STATE OF MISSOURI


Other


SUMMARY SUSPENSION


Docket/Case Number: AP-05-13



Allegations: ALLEGED VIOLATIONS OF NASD RULES BY FAILING TO ESTABLISH ANDMAINTAIN AN ADEQUATE SUPERVISORY SYSTEM AND PROVIDE RRS WITHADEQUATE GUIDANCE, ANALYTICAL TOOLS OR CRITERIA FOR MAKINGSUITABILITY ANALYSES FOR EXCHANGE RECOMMENDATIONS THATOCCURRED IN 2001 AND 2002.



Resolution:


Sanction Details: ON MARCH 29, 2005, A MISSOURI COURT ISSUED A TEMPORARYRESTRAINING ORDER PROHIBITING THE MISSOURI SECURITIESCOMMISSIONER FROM ENFORCING THE ORDER. THE SUMMARYSUSPENSION AND ORDER WERE CONCLUDED WITH PREJUDICE BY THEADMISTRATIVE CONSENT ORDER. THE ADMINISTRATIVE CONSENTORDER REQUIRES THE RESITUTION TO BE PAID WITHIN SIX MONTHS OFITS ENTRY AND THE FINE WITHIN TEN DAYS OF THE ENTRY.

Sanctions Ordered: CensureMonetary/Fine $57,645.65Disgorgement/Restitution

Settled






ON MARCH 29, 2005, A MISSOURI COURT ISSUED A TEMPORARYRESTRAINING ORDER PROHIBITING THE MISSOURI SECURITIESCOMMISSIONER FROM ENFORCING THE ORDER. THE SUMMARYSUSPENSION AND ORDER WERE CONCLUDED WITH PREJUDICE BY THEADMISTRATIVE CONSENT ORDER. THE ADMINISTRATIVE CONSENTORDER REQUIRES THE RESITUTION TO BE PAID WITHIN SIX MONTHS OFITS ENTRY AND THE FINE WITHIN TEN DAYS OF THE ENTRY.

Firm Statement THE MISSOURI SECURITIES COMMISSIONER ENTERED ITS 3/25/05 ORDERWITHOUT ANY HEARING OR OPPORTUNITY TO DEFEND THE ALLEGATIONS.WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, THE FIRM AGREEDTO RESOLVE THE MATTER BY CONSENTING TO THE ADMINISTRATIVECONSENT ORDER.

Disclosure 18 of 28

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Initiated By: NASD


Allegations: NASD CONDUCT RULES 2110, 2310, 3010, AND 3110, SECTION 17(A)(1) OFTHE SECURITIES EXCHANGE ACT OF 1934, RULE 17A-3(A)(6) THEREUNDER- RESPONDENT MEMBER ENGAGED IN AN AGGRESSIVE CAMPAIGN TOSWITCH THE VARIABLE ANNUITY CONTRACTS OF ITS CUSTOMERS FROMTHOSE ISSUED BY ONE INSURANCE COMPANY TO VERY SIMILARANNUITIES PROVIDED BY ANOTHER INSURANCE COMPANY. AS A RESULTOF THOSE EFFORTS, MEMBER FIRM'S REGISTERED REPRESENTATIVESRECOMMENDED, AND MEMBER FIRM EXCHANGED, MORE THAN 6,700VARIABLE ANNUITIES WORTH $616 MILLION. THOSE EXCHANGESGENERATED MORE THAN $37 MILLION IN COMMISSIONS TO MEMBERFIRM, AND COST ITS CUSTOMERS $9.8 MILLION IN SURRENDER CHARGES.IN DOING SO, MEMBER FIRM FAILED TO TAKE ADEQUATE STEPS TODETERMINE WHETHER THERE WERE REASONABLE GROUNDS FOR THECUSTOMERS TO ENTER INTO THESE EXCHANGES, SUCH AS DETERMININGWHETHER THE CUSTOMERS WERE LIKELY TO BENEFIT OR LOSE MONEYFROM THE EXCHANGES, AND FAILED TO ESTABLISH SUFFICIENTGUIDANCE FOR THE SALES FORCE TO USE IN DETERMINING THESUITABILITY OF THE EXCHANGES. IN FACT, MANY CUSTOMERS WERELIKELY TO LOSE MONEY THROUGH THESE SWITCHES, WHICH TYPICALLYWOULD RAISE CONCERNS ABOUT THE SUITABILITY OF THESETRANSACTIONS. THE COMPLAINT ALSO ALLEGED THAT MEMBER FIRMFAILED TO ESTABLISH AND MAINTAIN SUPERVISORY PROCEDURES, OR ASYSTEM TO SUPERVISE THE ACTIVITIES OF ITS ADVISORS, THAT WASREASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITH THEREQUIREMENTS OF NASD'S SUITABILITY RULE. FURTHERMORE, THEMEMBER FIRM FAILED TO MAINTAIN BOOKS AND RECORDS REGARDINGORDERS FOR UNEXECUTED VARIABLE ANNUITY EXCHANGES.










Docket/Case Number: CAF040002




Resolution:


Sanction Details: WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, WADDELL & REED,INC., CONSENTED TO THE DESCRIBED SANCTIONS AND TO THE ENTRY OFFINDINGS, THEREFORE THE FIRM IS CENSURED, FINED $5,000,000, ANDORDERED TO ESTABLISH A FUND IN THE AMOUNT OF $11,000,000 WHICHSHALL BE USED TO COMPENSATE CUSTOMERS. THE FIRM SHALL, AT ITSOWN EXPENSE, RETAIN AN INDEPENDENT CONSULTANT TO IMPLEMENTTHE DISTRIBUTION AND WITHIN 30 DAYS OF THIS ORDER THE FIRM SHALLPROVIDE THE CONSULTANT AND NASD WITH A PROPOSED SCHEDULE OFPAYMENTS.


No

Sanctions Ordered: CensureMonetary/Fine $5,000,000.00Disgorgement/Restitution

Decision & Order of Offer of Settlement


Allegations: ON APRIL 29, 2005, WADDELL & REED ENTERED INTO A DECISION & ORDEROF OFFER OF SETTLEMENT WITH THE NASD DEPARTMENT OFENFORCEMENT ("DOE") SETTLING A REGULATORY ACTION BROUGHT BYTHE DOE ON JANUARY 14, 2004 (CASE NO. CAF040002) ALLEGING THATWADDELL & REED VIOLATED NASD CONDUCT RULES 2110, 2310, 3010 AND3110, AND 17(A)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 ANDRULE 17A-3(A)(6) THEREUNDER, RELATING TO EXCHANGES MADE BYCERTAIN OF ITS CLIENTS OF THEIR VARIABLE ANNUITY POLICIES. THEDOE ALLEGED THAT WADDELL & REED FAILED TO TAKE ADEQUATE STEPSTO DETERMINE WHETHER THERE WERE REASONABLE GROUNDS FORTHE CLIENTS TO ENTER INTO THE EXCHANGES, SUCH AS DETERMININGWHETHER THE CUSTOMERS WERE LIKELY TO BENEFIT OR LOSE MONEYFROM THE EXCHANGES, FAILED TO ESTABLISH SUFFICIENT GUIDANCEFOR THE SALES FORCE TO USE IN DETERMINING THE SUITABILITY OF THEEXCHANGES, FAILED TO ESTABLISH AND MAINTAIN SUPERVISORYPROCEDURES OR A SYSTEM TO SUPERVISE THE ACTIVITIES OF ITSADVISORS THAT WAS REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH THE REQUIREMENTS OF THE NASD'S SUITABILITY RULE, AND FAILEDTO MAINTAIN BOOKS AND RECORDS REGARDING ORDERS FORUNEXECUTED VARIABLE ANNUITY EXCHANGES. WITHOUT ADMITTING ORDENYING THE ALLEGATIONS, WADDELL & REED AGREED TO BECENSURED, PAY A FINE OF $5 MILLION AND PAY CLIENT RESTITUTION OF$11 MILLION.






https://www.finra.org/industry/disciplinary-actions/finra-disciplinary-actions-online?search=caf040002


Initiated By: NASD




Docket/Case Number: CAF040002



ON APRIL 29, 2005, WADDELL & REED ENTERED INTO A DECISION & ORDEROF OFFER OF SETTLEMENT WITH THE NASD DEPARTMENT OFENFORCEMENT ("DOE") SETTLING A REGULATORY ACTION BROUGHT BYTHE DOE ON JANUARY 14, 2004 (CASE NO. CAF040002) ALLEGING THATWADDELL & REED VIOLATED NASD CONDUCT RULES 2110, 2310, 3010 AND3110, AND 17(A)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 ANDRULE 17A-3(A)(6) THEREUNDER, RELATING TO EXCHANGES MADE BYCERTAIN OF ITS CLIENTS OF THEIR VARIABLE ANNUITY POLICIES. THEDOE ALLEGED THAT WADDELL & REED FAILED TO TAKE ADEQUATE STEPSTO DETERMINE WHETHER THERE WERE REASONABLE GROUNDS FORTHE CLIENTS TO ENTER INTO THE EXCHANGES, SUCH AS DETERMININGWHETHER THE CUSTOMERS WERE LIKELY TO BENEFIT OR LOSE MONEYFROM THE EXCHANGES, FAILED TO ESTABLISH SUFFICIENT GUIDANCEFOR THE SALES FORCE TO USE IN DETERMINING THE SUITABILITY OF THEEXCHANGES, FAILED TO ESTABLISH AND MAINTAIN SUPERVISORYPROCEDURES OR A SYSTEM TO SUPERVISE THE ACTIVITIES OF ITSADVISORS THAT WAS REASONABLY DESIGNED TO ACHIEVE COMPLIANCEWITH THE REQUIREMENTS OF THE NASD'S SUITABILITY RULE, AND FAILEDTO MAINTAIN BOOKS AND RECORDS REGARDING ORDERS FORUNEXECUTED VARIABLE ANNUITY EXCHANGES. WITHOUT ADMITTING ORDENYING THE ALLEGATIONS, WADDELL & REED AGREED TO BECENSURED, PAY A FINE OF $5 MILLION AND PAY CLIENT RESTITUTION OF$11 MILLION.


Resolution:


Sanction Details: CENSURED, FINED $5,000,000.00; ORDERED TO ESTABLISH A FUND IN THEAMOUNT OF $11,000,000.00 WHICH SHALL BE USED TO COMPENSATECUSTOMERS; RETAIN AN INDEPENDENT CONTRACTOR CONSULTANT TOIMPLEMENT THE DISTIBUTION; AND WITHIN 30 DAYS OF THIS ORDER, THEFIRM SHALL PROVIDE THE CONSULTANT AND NASD WITH A PROPOSEDSCHEDULE OF PAYMENTS.

Sanctions Ordered: CensureMonetary/Fine $5,000,000.00Disgorgement/Restitution

Decision & Order of Offer of Settlement





https://www.finra.org/industry/disciplinary-actions/finra-disciplinary-actions-online?search=caf040002

www.finra.org/brokercheck User GuidanceCENSURED, FINED $5,000,000.00; ORDERED TO ESTABLISH A FUND IN THEAMOUNT OF $11,000,000.00 WHICH SHALL BE USED TO COMPENSATECUSTOMERS; RETAIN AN INDEPENDENT CONTRACTOR CONSULTANT TOIMPLEMENT THE DISTIBUTION; AND WITHIN 30 DAYS OF THIS ORDER, THEFIRM SHALL PROVIDE THE CONSULTANT AND NASD WITH A PROPOSEDSCHEDULE OF PAYMENTS.

Firm Statement WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, FIRM HASCONSENTED TO DESCRIBED SANCTIONS AND THE ENTRY OF FINDINGS.

Disclosure 19 of 28

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Initiated By: STATE OF FLORIDA, DEPARTMENT OF BANKING AND FINANCE, DIVISIONOF SECURITIES AND INVESTOR PROTECTION.







Allegations: ALLEGED FAILURE TO MAINTAIN AND PRODUCE RECORDS.



Resolution:


Sanction Details: RESTITUTION OF $3800.00 AND EXAMINATION COSTS OF $5000.00.

Sanctions Ordered: Disgorgement/Restitution


Disclosure 20 of 28

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Allegations: FAILING TO HAVE ADEQUATE SYSTEMS AND WRITTEN SUPERVISORYPROCEDURES IN PLACE IN REGARD TO PROPER COMPLETION OF THE "CLIENT ACKNOWLEDGEMENT REGARDIGN CHANGE IN INVESTMENTS"FORM, PARTICULARLY THE "TAX EFFECTS" SECTION.








Other


REVIEW COMPLIANCE AND SUPERVISORY PROCEDURES AND IFNECESSARY, AMEND, SUPPLEMENT, OR EXCISE PROCEDURES TOADDRESS PROPER SUPERVISION AND REVISION OF THE CLIENTACKNOWLEDGEMENT REGARDING CHANGE INVESTMENTS" FORM.


Docket/Case Number: 2001E053/1999-3973





Resolution:

Regulator Statement SPECIFIC ACTIONS RELATED TO THE UNDERTAKING TO BE REPORTEDWITHIN 60 DAYS OF ORDER.







Docket/Case Number: 2001E053


Other Product Type(s): VARIABLE ANNUITY

Allegations: ALLEGES INSUFFICIENT INSTRUCTIONS PROVIDED TO REGISTEREDREPRESENTATIVE REGARDING THE COMPLETION OF A CLIENTDISCLOSURE FORM.



Resolution:

Firm Statement WADDELL & REED, INC., AGREE THAT IT WILL REVIEW ITS COMPLIANCEAND SUPERVISORY PROCEDURES AND, IF NECESSARY, AMEND,SUPPLEMENT OR EXCISE SUCH PROCEDURES TO ADDRESS PROPERSUPERVISION AND REVISION OF THE CLIENT ACKNOWLEDGEMENT FORMAS REFERENCED IN THE COMMISSIONER'S ALLEGATIONS.







Firm Statement WADDELL & REED, INC., AGREE THAT IT WILL REVIEW ITS COMPLIANCEAND SUPERVISORY PROCEDURES AND, IF NECESSARY, AMEND,SUPPLEMENT OR EXCISE SUCH PROCEDURES TO ADDRESS PROPERSUPERVISION AND REVISION OF THE CLIENT ACKNOWLEDGEMENT FORMAS REFERENCED IN THE COMMISSIONER'S ALLEGATIONS.

Disclosure 21 of 28

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Initiated By: NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC.




Docket/Case Number: C11000007



Allegations: 04-28-00, NASD RULES 2110 AND 3010 - RESPONDENT MEMBER FAILED TOESTABLISH,MAINTAIN, AND ENFORCE WRITTEN SUPERVISORYPROCEDURES REASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITHAPPLICABLE SECURITIES LAWS,REGULATIONS, AND NASD RULESRELATING, AMONG OTHER THINGS, TO FORGERY, UNAUTHORIZEDTRANSACTIONS, AND MISAPPROPRIATION; AND FAILED TO RESPONDADEQUATELY AND TAKE APPROPRIATE ACTION TO SUPERVISE ITSREGISTERED REPRESENTATIVES, WHEN CONFRONTED WITH EVIDENCEOF PROBLEMS IN THOSE AREAS, THAT WAS REASONABLY DESIGNED TOPREVENT THE VIOLATIONS BY THE REGISTERED REPRESENTATIVE ANDACHIEVE COMPLIANCE WITH APPLICABLE SECURITIES LAWS,REGULATIONS, AND NASD RULES.



Resolution:


Sanction Details: CENSURED AND FINED $75,000

10-03-00, $75,000 PAID ON 5/24/00, INVOICE 00-10-310








Sanction Details: CENSURED AND FINED $75,000

10-03-00, $75,000 PAID ON 5/24/00, INVOICE 00-10-310


Initiated By: NASD REGULATION, INC.


Censure


MONETARY FINE OF $75000.00


Docket/Case Number: NO. C11000007



Allegations: ALLEGATIONS RELATING TO CONDUCT OF THREE OF APPLICANT'SREGISTERED REPRESENTATIVES WITH RESPECT TO THEIR MISUSE OFACCOUNT TRANSACTION REQUEST FORMS, FAILURE BY APPLICANT TOESTABLISH, MAINTAIN AND ENFORCE WRITTEN SUPERVISORYPROCEDURES REASONABLY DESIGNED TO ACHIEVE COMPLIANCE WITHTHE APPLICABLE SECURITIES LAWS AND REGULATIONS AND WITH NASDRULES RELATING, AMONG OTHER THINGS, TO FORGERY, UNAUTHORIZEDTRANSACTIONS AND MISAPPROPRIATION, AND FAILURE TO RESPONDADEQUATELY AND TAKE APPROPRIATE ACTION TO SUPERVISEREGISTERED REPRESENTATIVES, WHEN CONFRONTED WITH EVIDENCEOF PROBLEMS IN THE ABOVE-REFERENCED AREAS, THAT WASREASONABLY DESIGNED TO PREVENT THE VIOLATIONS BY THEREGISTERED REPRESENTATIVES.



Resolution:


Sanction Details: A MONETARY FINE OF $75000.00 WAS PAID TO NASDR.



Disclosure 22 of 28

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Initiated By: CONNECTICUT DEPT. OF BANKING




Docket/Case Number: ST-99-2948-S


Principal Product Type:


Allegations: 5/12/1999 STIPULATION AND AGREEMENT BETWEENTHE BANKING COMMISSIONER AND WADDELL & REED INC. ALLEGED THATTHE FIRM EXERCISED INSUFFICIENT SUPERVISION OVER DAVID ANDREWSTEVENSON (CRD # 1335836), AN AGENT WHO WAS IMPRISONED FORSECURITIES FRAUD AND LARCENY ON 12/16/1997 FOLLOWING AFEBURARY14, 1997 PERMANENT BAR BY THE CONNECTICUT DEPARTMENT OFBANKING. STEVENSON HAD PURPORTEDLY MISAPPROPRIATED OVER $2MILLION IN CUSTOMER FUNDS AND REDEEMED MUTUAL FUND HOLDINGSWITHOUT CUSTOMER CONSENT.



Resolution:


Sanction Details: STIPULATION AND AGREEMENT EXECUTED 5/12/1999.THE STIPULATION AND AGREEMENT ACKNOWLEDGED THAT THE FIRM HADMADE INTERNAL CHANGES TO ITS COMPLIANCE SYSTEM; VOLUNTARILYPAID OVER $2 MILLION TO CONNECTICUT INVESTORS; AND COOPERATEDWITH THE AGENCY IN ITS INVESTIGATION OF THE MATTER. PURSUANTTO THE STIPULATION AND AGREEMENT, THE FIRM AGREED TO CONDUCTANEXAMINATION PRIOR TO 12/31/1999 OF ALL CT BRANCH OFFICES ANDSUBMIT A WRITTEN REPORT OF THE RESULTS TO THE AGENCY WITHIN 30DAYS FOLLOWING COMPLETION OF THE EXAMINATION. THE FIRM ALSOAGREED TO PAY $15,000 TO THE AGENCY, $5,000 OF WHICHREPRESENTED REIMBURSEMENT FOR THE AGENCY'S INVESTIGATIVECOSTSAND $10,000 OF WHICH WOULD BE ALLOCATED TO THE AGENCY'SINVESTOR EDUCATION FUND. FINALLY, THE FIRM AGREED TO PROVIDEQUARTERLY REPORTS TO THE AGENCY FOR 2 YEARS CONCERNING ANYCOMPLAINTS, ACTIONS OR PROCEEDINGS INVOLVING CT RESIDENTS.

Sanctions Ordered:







STIPULATION AND AGREEMENT EXECUTED 5/12/1999.THE STIPULATION AND AGREEMENT ACKNOWLEDGED THAT THE FIRM HADMADE INTERNAL CHANGES TO ITS COMPLIANCE SYSTEM; VOLUNTARILYPAID OVER $2 MILLION TO CONNECTICUT INVESTORS; AND COOPERATEDWITH THE AGENCY IN ITS INVESTIGATION OF THE MATTER. PURSUANTTO THE STIPULATION AND AGREEMENT, THE FIRM AGREED TO CONDUCTANEXAMINATION PRIOR TO 12/31/1999 OF ALL CT BRANCH OFFICES ANDSUBMIT A WRITTEN REPORT OF THE RESULTS TO THE AGENCY WITHIN 30DAYS FOLLOWING COMPLETION OF THE EXAMINATION. THE FIRM ALSOAGREED TO PAY $15,000 TO THE AGENCY, $5,000 OF WHICHREPRESENTED REIMBURSEMENT FOR THE AGENCY'S INVESTIGATIVECOSTSAND $10,000 OF WHICH WOULD BE ALLOCATED TO THE AGENCY'SINVESTOR EDUCATION FUND. FINALLY, THE FIRM AGREED TO PROVIDEQUARTERLY REPORTS TO THE AGENCY FOR 2 YEARS CONCERNING ANYCOMPLAINTS, ACTIONS OR PROCEEDINGS INVOLVING CT RESIDENTS.

Regulator Statement CONTACT: S. IGDALSKY, 860-240-8234.


Initiated By: CONNECTICUT DEPARTMENT OF BANKING.


Other


REIMBURSEMENT OF EXAMINATION COSTS; CONTRIUBTION TO INVESTOREDUCATION FUND; REPORTING REQUIREMENTS.


Docket/Case Number: ST-99-2948-S



Allegations: THE BANKING COMMISSIONER ALLEGED WADDELL & REED, INC.EXERCISED INSUFFICIENT SUPERVISION OVER A FINANCIAL ADVISORWHO STOLE FROM CUSTOMERS. WADDELL & REED, INC. VOLUNTARILYREIMBURSED CUSTOMERS FOR AMOUNTS ALLEGEDLY STOLEN.



Resolution:


Sanction Details: $5000.00 TO REIMBURSE THE SECURITIES DIVISION'S COST OFINVESTIGATION. $10000.00 CONTRIBUTION TO THE DIVISION'S INVESTOREDUCATION FUND.

Firm Statement WADDELL & REED, INC. COMPLETED AN EXAMINATION OF ALL BRANCHOFFICE LOCATIONS IN CONNECTICUT BEFORE 12/31/99 AND REPORTEDTHE RESULTS TO THE DIVISION DIRECTOR. WADDELL & REED, INC.SUBMITTED TO THE DIVISION DIRECTOR QUARTERLY REPORTSDESCRIBING CUSTOMER COMPLAINTS RECEIVED BY THE FIRM AND THEIRDISPOSITION.

Sanctions Ordered:

Other





www.finra.org/brokercheck User GuidanceWADDELL & REED, INC. COMPLETED AN EXAMINATION OF ALL BRANCHOFFICE LOCATIONS IN CONNECTICUT BEFORE 12/31/99 AND REPORTEDTHE RESULTS TO THE DIVISION DIRECTOR. WADDELL & REED, INC.SUBMITTED TO THE DIVISION DIRECTOR QUARTERLY REPORTSDESCRIBING CUSTOMER COMPLAINTS RECEIVED BY THE FIRM AND THEIRDISPOSITION.

Disclosure 23 of 28

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Docket/Case Number: ATL-235



Allegations: NASD ARTICLE III, AND SECTION 1 OF RULES OF FAIR PRACTICEALLEGEDLY VIOLATED: COMPLAINT FILED ALLEGING THAT RESPONDENTMEMBER FAILED TO REGISTER TWO BRANCH OFFICES WITH NASD ASREQUIRED.



Resolution:

Other Sanctions Ordered: COSTS

Sanction Details: DECISION RENDERED ON JUNE 5, 1963, WHEREIN RESPONDENT MEMBERIS CENSURED, FINED $100, AND ASSESSED THE COSTS OF THEPROCEEDINGS IN THE AMOUNT OF $112.65. THE DECISION BECAME FINALJULY 5, 1953.


No

Sanctions Ordered: CensureMonetary/Fine $100.00

Decision

iReporting Source:










FIRM HAS NO RECORD OF THIS EVENT. SANCTIONS SOUGHT WERE NOTREPORTED ON FORM U6.




Other Product Type(s): FIRM HAS NO RECORD OF THIS EVENT. PRINCIPAL PRODUCT TYPEREPORTED IS PRODUCT TYPE PROVIDED ON FORM U6.

Allegations: FIRM HAS NO RECORD OF THIS EVENT. ALLEGATIONS PROVIDED ONFORM U6 ALLEGE FIRM FAILED TO REGISTER TWO BRANCH OFFICES WITHNASD.



Resolution:

Other Sanctions Ordered: FIRM HAS NO RECORD OF THIS EVENT. SANCTION DETAILS PROVIDEDARE THOSE REPORTED ON FORM U6: COSTS

Sanction Details: FIRM HAS NO RECORD OF THIS EVENT. SANCTION DETAILS PROVIDEDARE THOSE REPORTED ON FORM U6: CENSURED, FINED $100.00 ANDASSESSED COSTS OF PROCEEDINGS $112.65

Firm Statement FIRM HAS NO RECORD OF EVENT. INFORMATION PROVIDED ON DRPREFLECTS THE INFORMATION PROVIDED BY NASD ON FORM U6.


Decision

Disclosure 24 of 28

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Allegations: NASD ARTICLE III, AND SECTIONS 1, 2, AND 27 OF RULES OF FAIRPRACTICE ALLEGEDLY VIOLATED: COMPLAINT FILED THROUGH NASDDBCC NO. 7, ALLEGING THAT INDIVIDUAL RESPONDENTREPRESENTATIVES MADE UNSUITABLE RECOMMENDATIONS TOCOMPLAINANT AND RESPONDENT MEMBER FAILED TO SUPERVISEPROPERLY THE ACTIVITES OF THE RESPONDENT REPRESENTATIVES.













Other Product Type(s): UNSPECIFIED SECURITIES PRODUCT

NASD ARTICLE III, AND SECTIONS 1, 2, AND 27 OF RULES OF FAIRPRACTICE ALLEGEDLY VIOLATED: COMPLAINT FILED THROUGH NASDDBCC NO. 7, ALLEGING THAT INDIVIDUAL RESPONDENTREPRESENTATIVES MADE UNSUITABLE RECOMMENDATIONS TOCOMPLAINANT AND RESPONDENT MEMBER FAILED TO SUPERVISEPROPERLY THE ACTIVITES OF THE RESPONDENT REPRESENTATIVES.


Resolution:

Other Sanctions Ordered: COSTS

Sanction Details: NASD BOARD OF GOVERNER ("B/G") AFFIRMED THE FINDINGS ANDSANCTION OF CENSURE, $2,000 FINE, AND COST OF THE PROCEEDINGS$410.61 IMPOSED AGAINST RESPONDENT MEMBER BY NASD DBCC. INADDITION, RESPONDENT MEMBER AND OTHER INDIVIDUALRESPONDENTS ARE ASSESSED EQUALLY THE COSTS OF THEPROCEEDINGS BEFORE THE B/G OF $415.77.

Regulator Statement NASD DBCC DECISION RENDERED ON NOVEMBER 5, 1962 WHEREINRESPONDENT MEMBER IS CENSURED, FINED $2,000 AND ASSESSED THECOSTS OF THE PROCEEDINGS IN THE AMOUNT OF $410.61. RESPONDENTMEMBER APPEALED NASD DBCC DECISION TO NASD BOARD OFGOVERNER ON NOVEMBER 13, 1962.


No


Decision


Allegations: FIRM HAS NO RECORD OF THIS EVENT. ALLEGATIONS PROVIDED ONFORM U6 ALLEGE FIRM FAILED TO PROPERLY SUPERVISEREPRESENTATIVES BY PERMITTING REPRESENTATIVES TO MAKEUNSUITABLE RECOMMENDATIONS














Other Product Type(s): FIRM HAS NO RECORD OF THIS EVENT. PRINCIPAL PRODUCT TYPEREPORTED IS PRODUCT TYPE PROVIDED ON FORM U6.

Allegations: FIRM HAS NO RECORD OF THIS EVENT. ALLEGATIONS PROVIDED ONFORM U6 ALLEGE FIRM FAILED TO PROPERLY SUPERVISEREPRESENTATIVES BY PERMITTING REPRESENTATIVES TO MAKEUNSUITABLE RECOMMENDATIONS


Resolution:

Other Sanctions Ordered: FIRM HAS NO RECORD OF THIS EVENT. SANCTION DETAILS PROVIDEDARE THOSE REPORTED ON FORM U6: COSTS

Sanction Details: FIRM HAS NO RECORD OF THIS EVENT. SANCTION DETAILS PROVIDEDARE THOSE REPORTED ON FORM U6: CENSURE, $2000.00 FINE, COST OFPROCEEDING $410.61. FIRM AND OTHER RESPONDENTS ASSESSEDEQUALLY THE COSTS OF THE PROCEEDINGS OR $415.77. NASD DBCCDECISION RENDERED 11/5/1962. FIRM APPARENTLY APPEALED DECISIONON 11/13/1962.



Decision

Disclosure 25 of 28

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Allegations:














Resolution:


Sanction Details:

Regulator Statement COMPLAINT #33 - B/G ON 7/9/60 REMANDED DECISION TO DBCC #1FOR FURTHER DETERMINATION. BECAME FINAL 9/4/60 - FINES ANDCOSTS PAID.

Sanctions Ordered: Monetary/Fine

Decision









Other Product Type(s): FIRM HAS NO RECORD OF THIS EVENT. PRODUCT TYPES WERE NOTREPORTED ON FORM U6.

Allegations: FIRM HAS NO RECORD OF THE EVENT. ALLEGATIONS WERE NOTREPORTED ON FORM U6.



Resolution: Decision







Other Sanctions Ordered: FIRM HAS NO RECORD OF THIS EVENT. SANCTION DETAILS PROVIDEDARE THOSE REPORTED ON FORM U6.

Sanction Details: FIRM HAS NO RECORD OF THIS EVENT. SANCTION DETAILS PROVIDEDARE THOSE REPORTED ON FORM U6.


Sanctions Ordered: Monetary/Fine $0.00

Disclosure 26 of 28

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Docket/Case Number:



Allegations:



Resolution:


Sanction Details:

Regulator Statement ND 72-195 10/12/72REL 33-5318SEC HAS ORDERED PUBLIC PROCEEDINGS.ND 74-208 10/25/74REL. IC 8556THE COMMISSION FOUND THAT REGISTRANT VIOLATED THE ANTIFRAUDPROVISIONS OF THE SECURITIES ACTS. THE REGISTRANT CONSENTEDTOTHE FINDINGS WITHOUT ADMITTING OR DENYING THE CHARGES.REGISTRANT AND OTHERS HAVE UNDERTAKEN TO PAY CERTAIN SUMS TOUNITED FUND COMPLEX AND UNITED FUNDS, INC.


Consent






ND 72-195 10/12/72REL 33-5318SEC HAS ORDERED PUBLIC PROCEEDINGS.ND 74-208 10/25/74REL. IC 8556THE COMMISSION FOUND THAT REGISTRANT VIOLATED THE ANTIFRAUDPROVISIONS OF THE SECURITIES ACTS. THE REGISTRANT CONSENTEDTOTHE FINDINGS WITHOUT ADMITTING OR DENYING THE CHARGES.REGISTRANT AND OTHERS HAVE UNDERTAKEN TO PAY CERTAIN SUMS TOUNITED FUND COMPLEX AND UNITED FUNDS, INC.




Undertaking


RESTITUTION


Docket/Case Number: SEC DOCKET 339


Other Product Type(s): STOCKS AND BONDS IN MUTUAL FUND PORTFOLIOS

Allegations: VIOLATION OF SECTIONS 20(A) AND 34(B) OF THE INVESTMENT COMPANYACT AND RULE 20A-1 THEREUNDER IN CONNECTION WITH PROXYSTATEMENTS FOR INVESTMENT COMPANY SHAREHOLDER MEETINGS.



Resolution:


Sanction Details: APPLICANT AND TWO OTHER COMPANIES PAID A TOTAL OF $1,000,000WITHIN 30 DAYS OF THE ORDER DATED 10/24/1974.


Settled

Disclosure 27 of 28

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Allegations:














Resolution:


Sanction Details:

Regulator Statement COMPLAINT ATL-290 FILED 2/4/64 (ABBEVILLE, S.C. BO)DECISION 7/13/64 - CENSURE, $1,000 FINE, COSTS $65.00TO BE FINAL 8/13/64APPEALED TO B/G 7/16/64, DECISION STAYED.ON 12/23/64 THE B/G AFFIRMED FINDINGS.TO BE FINAL 1/22/65F & C PAID 1/15/65


Decision







Other Product Type(s): FIRM HAS NO RECORD OF THIS EVENT. PRODUCT TYPES WERE NOTREPORTED ON FORM U6.

Allegations: FIRM HAS NO RECORD OF THIS EVENT. ALLEGATIONS WERE NOTREPORTED ON FORM U6.











Resolution:

Other Sanctions Ordered: FIRM HAS NO RECORD OF THIS EVENT. SANCTION DETAILS PROVIDEDARE THOSE REPORTED ON FORM U6.

Sanction Details: FIRM HAS NO RECORD OF THIS EVENT. SANCTION DETAILS PROVIDEDARE THOSE REPORTED ON FORM U6.



Decision

Disclosure 28 of 28

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Other Product Type(s): SALES LITERATURE

Allegations: ARTICLE III, SECTIONS 1 AND 27(A) OF THE RULES OF FAIR PRACTICE -WADDELL & REED, ACTING THROUGH ITS AGENT, PREPARED ANDPRESENTED TO CUSTOMERS SALES LITERATURE IN VIOLATION OF THESEC STATEMENT OF POLICY AND FAILED TO SUPERVISE THECORRESPONDENCE OF A REGISTERED REPRESENTATIVE.



Resolution: Decision







Other Sanctions Ordered: PROCEEDING COSTS OF $117.47

Sanction Details: DISPOSITION OF COMPLAINT ON DECEMBER 3, 1963 WHEREIN THE FIRMWAS CENSURED AND ASSESSED PROCEEDING COSTS OF $117.47. ONDECEMBER 31,1963, THE BOARD OF GOVERNORS (B/G) CALLED THEDISTRICT BUSINESS CONDUCT COMMITTEE (DBCC) DECISION FORREVIEW. AUGUST 5, 1964, THE B/G AFFIRMED THE DBCC FINDINGS OF THEVIOLATIONS OF SECTIONS 1 AND 27(A) OF ARTICLE III BUT REVERSED THEFINDINGS OF THE VIOLATION OF THE SEC STATEMENT OF POLICY ANDINCREASED THE PENALTY IMPOSED TO CENSURE, $200 FINE PLUSPROCEEDING COSTS BEFORE THE DBCC OF $117.47. CASE CLOSEDAUGUST 5, 1964.


No





Censure


MONETARY FINE - $200




Other Product Type(s): SALES LITERATURE

Allegations: ARTICLE III, SECTIONS 1 AND 27(A) OF THE RULES OF FAIR PRACTICE -WADDELL & REED, ACTING THROUGH ITS AGENT, PREPARED ANDPRESENTED TO CUSTOMERS SALES LITERATURE IN VIOLATION OF THESEC STATEMENT OF POLICY AND FAILED TO SUPERVISE THECORRESPONDENCE OF A REGISTERED REPRESENTATIVE.


Resolution: Decision67©2018 FINRA. All rights reserved. Report about WADDELL & REED






Resolution:

Other Sanctions Ordered: PROCEEDING COSTS OF $117.47

Sanction Details: DISPOSITION OF COMPLAINT ON DECEMBER 3, 1963, WHEREIN THE FIRMWAS CENSURED AND ASSESSED PROCEEDING COSTS OF $117.47. ONDECEMBER 31, 1963, THE BOARD OF GOVERNORS (B/G) CALLED THEDISTRICT BUSINESS CONDUCT COMMITTEE (DBCC) DECISION FORREVIEW. AUGUST 5, 1964, THE B/G AFFIRMED THE DBCC FINDINGS OF THEVIOLATIONS OF SECTIONS 1 AND 27(A) OF ARTICLE III BUT REVERSED THEFINDINGS OF THE VIOLATION OF THE SEC STATEMENT OF POLICY ANDINCREASED THE PENALTY IMPOSED TO CENSURE, $200 FIND PLUSPROCEEDING COSTS BEFORE THE DBCC OF $117.47. CASE CLOSEDAUGUST 5, 1964.


Decision






Civil - Final

This type of disclosure event involves (1) an injunction issued by a foreign or domestic court within the last 10 years inconnection with investment-related activity, (2) a finding by a court of a violation of any investment-related statute orregulation, or (3) an action dismissed by a court pursuant to a settlement agreement.

Disclosure 1 of 1


Initiated By: STATE OF IDAHO, DEPARTMENT OF FINANCE

Relief Sought: Restitution

Other Relief Sought: INJUNCTION

Date Court Action Filed: 11/03/1994


Other Product Types: CERTIFICATES OF DEPOSIT

Court Details: DISTRICT COURT OF THE FOURTH JUDICIAL DISTRICT OF THE STATEOF IDAHO, IN AND FOR THE COUNTY OF ADA.DOCKET NO. 1966-7-95

THE COMPLAINT ALLEGED UNSUITABLE RECOMMENDATIONS, FAILURE TOMAINTAIN RECORDS, AND MISREPRESENTATION WITH RESPECT TO AFEBRUARY 9, 1983 PURCHASE OF MUTUAL FUNDS SHARES, ANDOFFERING CERTIFICATES OF DEPOSIT BY REPRESENTATIVES NOTREGISTERED TO OFFER SUCH CERTIFICATES.

Allegations:


Resolution: Settled


Other Sanctions:

Sanction Details: $11,000 WAS PAID TO CUSTOMER JULY 1, 1996.

Disgorgement/RestitutionSanctions Ordered or ReliefGranted:






Arbitration Award - Award / Judgment

Brokerage firms are not required to report arbitration claims filed against them by customers; however, BrokerCheckprovides summary information regarding FINRA arbitration awards involving securities and commodities disputesbetween public customers and registered securities firms in this section of the report. The full text of arbitration awards issued by FINRA is available at www.finra.org/awardsonline.

Disclosure 1 of 12


Type of Event: ARBITRATION

Arbitration Forum:

Case Initiated:

Case Number:

Allegations:

Disputed Product Type:

Sum of All Relief Requested:

Disposition:

Disposition Date:

Sum of All Relief Awarded:

NASD

12/13/2001

01-06615

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT RELATED-BREACHOF CONTRACT; ACCOUNT RELATED-FAILURE TO SUPERVISE; ACCOUNTRELATED-NEGLIGENCE

ANNUITIES; DO NOT USE-NO OTHER TYPE OF SEC INVOLVE; MUTUALFUNDS

$392,461.26

AWARD AGAINST PARTY

12/19/2002

$55,032.00

There may be a non-monetary award associated with this arbitration.Please select the Case Number above to view more detailed information.

Disclosure 2 of 12

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:

NASD

05/30/2003

03-03793

ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSIONOF FACTS; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNT RELATED-NEGLIGENCE





www.finra.org/awardsonline

https://www.finra.org/arbitration-and-mediation/arbitration-awards-online?search=01-06615





Disposition:

Disposition Date:


DO NOT USE-NO OTHER TYPE OF SEC INVOLVE; MUTUAL FUNDS

$170,000.00

AWARD AGAINST PARTY

07/06/2004

$15,104.00


Disclosure 3 of 12

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

07/15/2005

05-03570

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSION OF FACTS;ACCOUNT ACTIVITY-SUITABILITY

ANNUITIES; DO NOT USE-NO OTHER TYPE OF SEC INVOLVE

$41,963.07

AWARD AGAINST PARTY

12/19/2005

$13,647.37


Disclosure 4 of 12

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Arbitration Forum:

Allegations:

NASD

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT RELATED-BREACH OF CONTRACT;ACCOUNT RELATED-NEGLIGENCE







Case Initiated:

Case Number:



Disposition:

Disposition Date:


04/18/2006

06-01704

DO NOT USE-NO OTHER TYPE OF SEC INVOLVE; MUTUAL FUNDS

$30,476.96

AWARD AGAINST PARTY

04/20/2007

$12,000.01


Disclosure 5 of 12

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

05/22/2007

07-01589

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-SUITABILITY; DO NOT USE-NO OTHER CONTROVERSY INVOLVED

ANNUITIES; DO NOT USE-NO OTHER TYPE OF SEC INVOLVE; MUNICIPALBONDS; OTHER TYPES OF SECURITIES

$32,914.09

AWARD AGAINST PARTY

12/06/2007

$12,563.10


Disclosure 6 of 12

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Allegations: ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSION OF FACTS;ACCOUNT ACTIVITY-SUITABILITY; ACCOUNT RELATED-ERRORS-CHARGES;ACCOUNT RELATED-FAILURE TO SUPERVISE; ACCOUNT RELATED-NEGLIGENCE; ACCOUNT RELATED-TRANSFER; OTHER-INDEMNIFICATION








Arbitration Forum:

Case Initiated:

Case Number:



Disposition:

Disposition Date:


FINRA

04/11/2011

11-01367

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSION OF FACTS;ACCOUNT ACTIVITY-SUITABILITY; ACCOUNT RELATED-ERRORS-CHARGES;ACCOUNT RELATED-FAILURE TO SUPERVISE; ACCOUNT RELATED-NEGLIGENCE; ACCOUNT RELATED-TRANSFER; OTHER-INDEMNIFICATION

MUTUAL FUNDS

$25,000.00

AWARD AGAINST PARTY

09/27/2011

$212.50


Disclosure 7 of 12

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


FINRA

08/03/2017

17-02027

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSION OF FACTS;ACCOUNT ACTIVITY-SUITABILITY; ACCOUNT RELATED-FAILURE TOSUPERVISE; ACCOUNT RELATED-NEGLIGENCE

VARIABLE ANNUITIES

$50,000.00

AWARD AGAINST PARTY

05/02/2018

$54,492.00


Disclosure 8 of 12

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Disclosure 8 of 12



Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

05/18/1990

90-00881

DO NOT USE-NO OTHER CONTROVERSY INVOLVED

DO NOT USE-NO OTHER TYPE OF SEC INVOLVE

$116,224.00

AWARD AGAINST PARTY

10/15/1990

$70,000.00


Disclosure 9 of 12

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

01/09/1992

91-03995

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNTRELATED-NEGLIGENCE

MUTUAL FUNDS; UNKNOWN TYPE OF SECURITIES

$54,000.00

AWARD AGAINST PARTY

11/20/1992

$10,400.00









Disclosure 10 of 12

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

02/20/1992

92-00330

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; DO NOT USE-NO OTHER CONTROVERSY INVOLVED

COMMON STOCK; DO NOT USE-NO OTHER TYPE OF SEC INVOLVE

$1,150.00

AWARD AGAINST PARTY

07/13/1992

$1,125.00


Disclosure 11 of 12

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

10/04/1993

93-03178

ACCOUNT ACTIVITY-BRCH OF FIDUCIARY DT; ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNTRELATED-NEGLIGENCE

COMMON STOCK; DO NOT USE-NO OTHER TYPE OF SEC INVOLVE

$7,090.45

AWARD AGAINST PARTY

05/19/1994

$1,000.00









Disclosure 12 of 12

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Arbitration Forum:

Case Initiated:

Case Number:

Allegations:



Disposition:

Disposition Date:


NASD

02/09/1995

94-05539

ACCOUNT ACTIVITY-MISREPRESENTATION; ACCOUNT ACTIVITY-OMISSIONOF FACTS; ACCOUNT ACTIVITY-SUITABILITY; ACCOUNT RELATED-NEGLIGENCE

DO NOT USE-NO OTHER TYPE OF SEC INVOLVE; LIMITED PARTNERSHIPS

$360,000.00

AWARD AGAINST PARTY

09/13/1996

$1,320,348.50








Civil Bond

This type of disclosure event involves a civil bond for the brokerage firm that has been denied, paid, or revoked by abonding company.

Disclosure 1 of 3


Policy Holder: WADDELL & REED, INC.

Bonding Company Name: NATIONAL UNION FIRE INSURANCE COMPANY

Disposition: Payout

Disposition Date: 02/05/1987

Payout Details: $100,000 WAS PAID ON 02/05/1987

Firm Statement APPLICANT FILED A CLAIM WITH NATIONAL UNION FIRE INSURANCECOMPANY OF PITTSBURGH, PA. WITH RESPECT TO EMBEZZLEMENT BY ITSTERMINATED REPRESENTATIVE, WILLIAM WEBBER. THE BONDINGCOMPANY DID PAY OUT ON THE CLAIM. THERE WAS NO REGULATORYACTION INVOLVING THE APPLICANT.

Disclosure 2 of 3

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Bonding Company Name: GULF INSURANCE COMPANY

Disposition: Payout


Payout Details: $1,700,000 WAS PAID OUT ON 6/22/1999

Firm Statement APPLICANT HAS FILED A CLAIM WITH GULF INSURANCE COMPANY WITHRESPECT TO ALLEGED INFIDELITY BY ITS TERMINATED REPRESENTATIVE,EMMANUEL LAGPACAN. THE BONDING COMPANY PAID OUT A PORTION OFTHE CLAIM. TO DATE, NO REGULATORY PROCEEDING INVOLVING THEAPPLICANT HAS BEEN COMMENCED.

Disclosure 3 of 3

i



Bonding Company Name: GULF INSURANCE COMPANY

Disposition: Payout77©2018 FINRA. All rights reserved. Report about WADDELL & REED





Disposition: Payout


Payout Details: $750,000.00 WAS PAID OUT ON 11/04/1997.

Firm Statement APPLICANT FILED A CLAIM WITH GULF INSURANCE COMPANY WITHRESPECT TO EMBEZZLEMENT BY ITS TERMINATED REPRESENTATIVE,DAVID STEVENSON. THE BONDING COMPANY DID PAY OUT ON A PORTIONOF THE CLAIM. TO DATE, NO REGULATORY PROCEEDINGS INVOLVINGTHE APPLICANT HAS BEEN COMMENCED.






End of Report

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