Administrative Consent Order Regarding Edward D. Jones & Co., L.P.

COMMONWEAL TH OF PENNSYLVANIA
IN THE MATTER OF:
EDWARD D. JONES & CO., L.P.
Respondent.
ADMINISTRATIVE CONSENT
ORDER
BEFORE ERIC PISTILLI, DEPUTY SECRETARY OF SECURITIES Pursuant to the authority granted to the Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities. under the Pennsylvania Securities Act of 1972. 70 P.S. §§ 1-10 I et seq. ("' 1972 Act"), and after investigation. careful review. and due consideration of the facts and statutory provisions set forth below, the Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities. hereby finds that there is good cause, and it is in the public interest to enter into a Consent Order (the "Order'') with Edward D. Jones & Co., L.P. ("Edward Jones"), which hereby agrees to resolve any and all issues in controversy regarding the specifc conduct described herein on the terms set forth in this Order. As the result of a coordinated investigation. Pennsylvania concluded that Edward Jones charged unreasonable commissions on certain small principal equity transactions. Nationwide. Edward Jones charged unreasonable commissions on approximately 781,240 equity transactions f rom May I, 2020 to April 30, 2025 totaling $11.287,504. Edward Jones in full settlement of these matters neither admits nor denies the Statement of Facts as set forth in Section Ill, and neither admits nor denies the Conclusions of Law set out in Section IV. 2025 SEPT 8 8:43 AM PA DEPARTMENT OF BANKING AND SECURITIES Docket No. 250026 (SEC-ORD)

I. JURISDICTION
I. The Pennsylvania Department of Banking and Securities has jurisdiction pursuant
to the 1972 Act, 70 P.S. §§ 1-10 I et seq.
2. This Order is issued in accordance with the 1972 Act, 70 P.S. §§ 1-10 I et seq.
3. The acts and practices that are the subject of this Order occurred while Edward
Jones was registered as a broker-dealer in Pennsylvania.
II. RESPONDENT
4. Edward D. Jones & Co., L.P. ("Edward Jones") is a broker-dealer registered in
Pennsylvania with a main address of 12555 Manchester Road, St. Louis, Missouri 63131. Edward Jones is identified by Financial Industry Regulatory Authority ("FINRA") CRD No. 250.
III. FINDINGS OF FACT
A. Edward Jones's Minimum Commission Practices for Certain Equity Transactions Failed to Ensure Transactions Were Executed at a Fair and Reasonable Price
5. Except as otherwise expressly stated, the conduct described herein occurred during
the time period of May I, 2020 to April 30, 2025 (the "Relevant Time Period'').
6. During the Relevant Time Period, Edward Jones charged unreasonable
commissions to thousands of retail brokerage customers on certain equity transactions.
7. During a portion of the Relevant Time Period, Edward Jones charged a minimum
fixed commission of $50 on certain equity transactions (the "Minimum Equity Commission").
8. The Act and Regulations prohibit Edward Jones f
rom charging unreasonable commissions for services performed.
9. FrNRA Rule 2121 Supplementary Material .01 (Rule 2121.01) sets a guideline of
five percent for determining whether a commission is unfair or unreasonable. However. the "5%

Policy" is a guide, not a rule. A commission pattern of five percent or even less may be considered unfair or unreasonable. I 0. During the Relevant Time Period, Edward Jones executed 16,681 equity transactions in Pennsylvania which included an unreasonable commission for services performed (i.e., in excess of5% of the principal trade amount), totaling $241,040.51. I I. Numerous equity transactions executed by Edward Jones included a commission well in excess of 5% of the principal value of the transaction. B. 12. Edward Jones Did Not Reasonably Supervise Transactions Which Applied the Minimum Equity Commission Edward Jones did not reasonably supervise transactions that included the Minimum Equity Commission charge to ensure that Edward Jones charged its customers a reasonable commission.
13. Edward Jones's policies and procedures contemplated review of commissions as
part of normal supervisory review processes.
14. Edward Jones's policies and procedures also contemplated a quarterly review of
data related to small principal transactions that could result in excessive commissions.
15. Supervisors were permitted to make adjustments to ensure that commissions were
reasonable.
16. Despite these systems, Edward Jones's surveillance policies failed to reasonably
detect and correct unreasonable commission charges. specifically as it relates to the Minimum Equity Commission.
17. As a result, Edward Jones failed to adequately supervise small principal equity
transactions where the Minimum Equity Commission was in excess of 5%.

I� CONCLU�ONSOFLAW
18. The preceding paragraphs are incorporated by reference as though set forth
verbatim herein.
19. Pursuant to 70 P.S. § l-305(a)(vii), it is a basis to deny, suspend. revoke, or
condition the registration of a registered broker-dealer firm that fails to establish and maintain a system to reasonably supervise its agents.
20. Edward Jones·s acts and practices, as described above constitute a failure to enforce
a reasonably designed supervisory system, which acts and conduct form a basis to deny, suspend, revoke, or condition the registration of Edward Jones or to censure Edward Jones pursuant to 70 P.S. § 1-305 (a)(vii).
V. ORDER
21. On the basis of the Findings of Fact, Conclusions of Law, and Edward Jones's
consent to the entry of this Order, IT IS HEREBY ORDERED:
A. Edward Jones shall permanently cease and desist from conduct in violation of 70 P.S. § l-305(a)(vii); B. Edward Jones is censured by the Pennsylvania Department of Banking and Securities;
C. Edward Jones shall provide restitution in an amount of no less than $241,040.51,
representing the portion of the commission on ce1tain small principal equity transactions that exceeded 5% of the principal trade amount during the Relevant Time Period to the affected Pennsylvania customers set forth in Exhibit A. plus interest in the amount of 6% from the date of the transaction to May 19, 2025.

Edward Jones shall provide restitution as soon as practicable, but in no event longer than one hundred eighty ( 180) days of execution of this Order; D. Restitution shall be in the form of a dollar credit to current customer accounts. or a check for all former customers; E. Edward Jones shal I provide a notice of restitution to customers on terms not unacceptable to Massachusetts, Montana, Missouri. Alabama, Washington, Texas, and Iowa (the "Multi-state Group") ("Notice Letter·') for use by all participating jurisdictions. The Notice Letter shall be sent at least seven (7) days prior to the distribution of any restitution. Within forty-ive (45) days of the mailing of the Notice Letter, Edward Jones shall provide the Deputy Secretary of Securities. Pennsylvania Department of Banking and Securities with a list of all Pennsylvania residents for whom Edward Jones receives a Notice Letter as returned to sender or otherwise undeliverable. To the extent the Deputy Secretary of Securities. Pennsylvania Depa1tment of Banking and Securities and has access to different address information, Edward Jones shall mail a second Notice Letter to each Pennsylvania resident within thirty (30) days of the Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities providing such different address;

1. Within forty-five (45) days of completion of distribution of restitution,
   Edward Jones shall prepare, and submit to the Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities. a repo1t detailing the restitution paid pursuant to the Order, which shall include dates, amounts, and methods of the transfer of funds for all restitution payments;

F. Edward Jones shall pay an administrative tine in the amount of$ I 00,000 to the Pennsylvania Department of Banking and Securities within fifteen ( 15) days following the date of entry of the Order. Payment shall be: (I) made by United States postal money order, certified check, bank cashier's check, bank money order, or wire; (2) made payable to the Pennsylvania Department of Banking and Securities; (3) either hand-delivered, mailed to 17 N. Second Street, Suite 1300, Harrisburg, PA 1710 I; or wired per the Pennsylvania Department of Banking and Securities' instructions; and ( 4) submitted under cover letter or other documentation that identifies payment by Edward Jones and the docket number of the proceeding; G. Edward Jones agrees that an employee not unacceptable to the Multi-State Group shall certify in writing to the Division within sixty (60) days of the date of entry of the Order that Edward Jones' policies and procedures have been changed and enhanced to ensure that all commissions are fair and reasonable. At a minimum, Edward Jones shall certify that its policies and procedures include the following:
1. Compliance systems to prevent the imposition of unreasonable or unfair
commissions;
11 Operational changes designed to ensure that, regard less of the principal amount of a transaction. commissions will not exceed 5%, in the absence of a documented exception;
111. Incorporation of all transactions, regardless of the principal amount of the
transaction, into any systems used to identify and review potentially excessive commissions; and

iv. Revisions to its policies and procedures sufficient to ensure the adequate
implementation of the above.
H. Edward Jones shall not claim, assert, or apply for a tax deduction or tax credit with regard to any state, federal or local tax for any amounts that Edward Jones shall pay pursuant to the Order;
I. Edward Jones shall not seek or accept, directly or indirectly. reimbursement or
indemnification, including. but not limited to, any payments made pursuant to any insurance policy, with regard to any amount that Edward Jones shall pay pursuant to the Order; J. If Edward Jones is the subject of a voluntary or involuntary bankruptcy petition under Title 11 of the United States Code within three hundred sixty-five (365) days of the entry of the Order, Edward Jones shall provide written notice to the Deputy Secretary of Securities. Pennsylvania Department of Banking and Securities within five (5) days of the date of the petition. K. Any fine, penalty, and/or money that Edward Jones shall pay in accordance with the Order is intended by Edward Jones and the Deputy Secretary of Securities. Pennsylvania Department of Banking and Securities to be a contemporaneous exchange for new value given to Edward Jones pursuant to 11 U.S.C. § 547(c)( I )(A) and is, in fact. a substantially contemporaneous exchange pursuant to 11 U.S.C. § 547(c)(l)(B).
L. If Edward Jones fails to materially comply with any of the terms set forth in the
Order, the Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities may institute an action to have the Order declared null and void.

Additionally. after a fair hearing and the issuance of an order finding that Edward Jones has not complied with the Order. the Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities may move to have the Order declared null and void. in whole or in pait. and re-institute the associated proceeding that had been brought against Edward Jones; and M. For good cause shown, the Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities may extend any of the procedural dates set forth above. Edward Jones shall make any requests for extensions of the procedural dates set forth above in writing to Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities.
VI. WAIVER
22. Edward Jones hereby waives all rights to contest an Order entered by the Deputy
Secretary of Securities, Pennsylvania Department of Banking and Securities, including. but not limited to, (A) the right to contest whether the Order is fair, reasonable, and/or in the public interest, (B) the right to contest the Order·s findings of fact, and (C) the right to contest the Order·s conclusions of law. Edward Jones further waives the procedural due process right to a hearing and any other procedural rights provided by the 1972 Act.
VII. NO DISQUALIFICATION
23. This Order waives any disqualification in the 1972 Act. or rules or regulations
thereunder, including any disqualification from relying upon the registration exemptions or safe harbor provisions to which Edward Jones may be subject. The Order is not intended to be a final order based upon violations of the 1972 Act that prohibit f r audulent, manipulative. or deceptive conduct. The Order is not intended to form the basis of any disqualifications under Section 3(a)(39)

of the Securities Exchange Act of 1934; or Rules 504(b)(3) and 506(d)( I) of Regulation D. Rule 262(a) of Regulation A and Rule 503(a) of Regulation CF under the Securities Act of 1933. The Order is not intended to form the basis of disqualification under the FINRA rules prohibiting continuance in membership absent the filing of a MC-400A application or disqualiication under SRO rules prohibiting continuance in membership. The Order is not intended to form a basis of a disqualification under 204(a)(2) of the Uniform Securities Act of 1956 or Section 4 I 2(d) of the Uniform Securities Act of 2002. Except in an action by the Deputy Secretary of Securities, Pennsylvania Department of Banking and Securities to enforce the obligations of the Order. any acts performed or documents executed in furtherance of the Order: (a) may not be deemed or used as an admission of, or evidence of, the validity of any alleged wrongdoing, liability, or lack of any wrongdoing or liability; or (b) may not be deemed or used as an admission of; or evidence of. any such alleged fault or omission of Edward Jones in any civil. criminal, arbitration, or administrative proceeding in any court, administrative agency, or tribunal.
24. This Order shall be binding upon Edward Jones and its successors and assigns. as
well as to successors and assigns of relevant affiliates, with respect to all conduct subject to the provisions above.
25. This Order and any dispute related thereto shall be construed and enforced in
accordance with, and governed by. the laws of Pennsylvania without regard to any choice of law principles.