The SEC Division of Examinations published a Risk Alert on June 9, 2026 documenting a wide range of fee-related deficiencies discovered during recent adviser examinations — from incorrect billing calculations to conflicts of interest that were never disclosed to clients. If you want to understand the full picture of how financial advisor fees actually work, the SEC’s findings show just how often the disclosed fee schedule and the actual charges diverge.
What the SEC Examiners Found
According to the SEC Division of Examinations, examiners identified multiple categories of billing errors and disclosure failures. Advisers charged fees on assets explicitly excluded by their advisory agreements, applied incorrect fee rates, failed to honor household breakpoint discounts, and in some cases billed clients for accounts receiving no services at all — including inactive accounts and internal transfer duplicates. Proration methods not authorized by client agreements were also used.
Beyond billing errors, examiners flagged a pattern of undisclosed economic conflicts. Advisers recommended cash sweep programs at affiliated institutions — earning revenue on those balances — while disclosing only that they “may” receive such revenue, even when they routinely did. In some arrangements, clients experienced negative net returns from the recommended programs. On the mutual fund side, advisers steered clients toward higher-cost share classes that generated revenue-sharing arrangements for the firm, without disclosing the availability of lower-cost, higher-yielding share classes of the same funds.
What Investors Should Do Now
The Risk Alert is explicitly framed as guidance for advisers to tighten their compliance programs, but the practical takeaway for investors is direct: request a full fee breakdown in writing, cross-reference it against your advisory agreement, and ask your adviser to document any revenue they or their firm receive from third parties connected to your account. Form ADV Parts 1 and 2 — filed publicly with the SEC — must disclose financial industry affiliations and brokerage arrangements; checking Items 10 and 12 in your adviser’s ADV is the fastest way to spot potential conflicts before they show up on your statement.