Shareholder Spotlight Bonus Edition #4 - Raymond James Financial

There is a particular kind of rot that doesn’t announce itself with smoke and sirens. It smells faintly of polished floors, client meetings, and the soft click of trading desks. Raymond James looks like the kind of firm your father would trust with his pension – tweed jackets, conservative brochures, and a PR team that smiles like a syringe. But scratch the surface and you find the same grubby human habits that swamp every big finance name – corners cut, rules bent, privacy breached, and regulators tapping their watches.

The Off-Channel Messages: WhatsApp, iMessage, and the Record-Keeping Mess

Employees swapped business messages on personal apps – WhatsApp, iMessage, Signal – and failed to keep the legally required records. That probe blew up into an industry-wide sweep, and Raymond James agreed in principle to a $50 million civil penalty to settle the SEC’s off-channel communications investigation – the same investigation that netted dozens of other firms. This was not a single bad apple; it was a cultural leak.

AML Failures: The $17 Million Slap

A little less poetic and a lot more blunt – FINRA found Raymond James’ anti-money-laundering controls wanting. In 2016, the firm paid roughly $17 million after regulators concluded its AML program and supervision had “widespread” lapses – a system-level failure in policing suspicious flows. That kind of failure is not bureaucracy gone wrong; it is an entire control room asleep at the wheel.

Excessive Commissions and the State Squeeze

Across multiple states and through NASAA investigations, Raymond James has been pushed to answer for charging unreasonable commissions on thousands of small equity trades. State enforcement and self-regulatory settlements forced restitution and civil penalties – Oregon alone extracted restitution and a penalty after concluding excessive minimum commissions were charged on hundreds of transactions. The pattern here reads like profit margins trumping basic fairness.

Data Exposure: Client Details on the Line

In 2025, Raymond James began notifying clients about a data incident that may have exposed highly sensitive account information – including names and Social Security numbers for some customers. State filings and consumer notices show they placed ID-theft protections on affected accounts – but the damage if your identity appears in a third-party ledger is not fixed with credit monitoring alone. It’s sloppy and unforgiving.

Named in SEC Cases: Relief Defendant Status and Insider Traces

In several enforcement cases, the SEC named Raymond James as a relief defendant—meaning trades or proceeds connected to wrongdoing flowed through firm accounts, and the regulator sought recovery of ill-gotten gains sitting in those accounts. That’s technical but damning – when a broker-dealer’s accounts are used as the resting place for suspicious profits, it is an operational and reputational problem that goes beyond an errant employee.

Brokers Gone Rogue: Arbitration and Punitive Awards

Individual brokers and advisers have cost the firm and clients dearly – FINRA arbitration panels have hit former Raymond James advisers with multi-million pound-equivalent awards for soliciting clients, breaching sales agreements, or bad conduct. Those are not PR stumbles; they are legally enforceable judgments that sting shareholders and underline supervisory gaps.

A Mosaic of Consent Orders, State Probes, and Slow Disclosures

Raymond James’ public filings and regulatory consent orders reveal a steady stream of investigations – spanning inadequate reporting, supervisory shortcomings, chargebacks, and customer restitution. The picture is not of a one-off scandal; it’s an institutional pattern that repeats in different jurisdictions and regulatory layers.

What It Feels Like on the Ground: Why the Outrage

This is the bit people forget when numbers are dropped into press releases – behind every “consent order” and “civil penalty” are people who lost money, had their identities exposed, or trusted a firm that treated record-keeping as optional. The arrogance is subtle – a system designed to make small errors excusable because the scale of profits makes regulatory fines “just the cost of doing business.” That is corrosive.

Cummins Holding: A Small Confirmation and an Ugly Ecosystem Link

Brief and factual – Raymond James is a material institutional holder of Cummins Inc. (ticker CMI). Public 13F and institutional-holdings data show Raymond James with roughly 1.3–1.45 million shares in recent filings – a stake worth several hundred million dollars at current prices. So yes – Raymond James sits inside the broader Cummins shareholder ecosystem – another institution in that network with its own ethical flexibilities.

The Takeaway: Polished Floors, Grubby Hands

If you want theatre, there are bigger scandals with more dramatic headlines. But the steady hum of regulatory actions, the data incident, the AML failures, and the systemic off-channel communications issue add up to something more dangerous than a one-off scandal – they point to a repeated tolerance for behaviour that edges, then crosses, legal and ethical lines. That is the story worth telling – not the flash of a single headline, but the steady drip that corrodes trust.

Lee Thompson – Founder, The Cummins Accountability Project

Shareholder Spotlight Bonus Edition #4 – Raymond James Financial