Edward Jones Needs To Improve Its Back Office Procedures To Properly Service The Investors Whom It Seeks

Today, Edward Jones promotes itself as a firm that investors, including retirees, can trust. Edward Jones touts on its website:

We know we can't be all things to all investors. And we're OK with that. Edward Jones has a distinct set of guiding principles and investment philosophy. For decades, we've believed in the same basic strategy of buying quality investments that have proved themselves over time. Our financial advisors also meet with you and talk with you regularly to make sure we’re best able to meet your financial needs.
If you want to trade options and commodities online, there are plenty of firms and websites that can help you do that. For us, it's about getting to know you and what you want to achieve. Then we'll work together to build a strategy to help you get you there. This is our approach, and we're sticking with it. Most of our clients share some common investing preferences. See if any of these sound like you.
•    You have long-term goals and are willing to follow a disciplined strategy to get there.
•    You want to work with a financial advisor who works with individual investors.
•    You want to have a conversation about retirement or saving for education, not just push a "BUY" button.
•    You value the relationship that can be developed with your local financial advisor.
•   
Yet, in 2009, FINRA fined Edward Jones for significant back office problems.  Below is the relevant text of the FINRA press release:

FINRA Fines Edward Jones $900,000 for Failing to Timely Deliver Official Statements to Customers in Municipal Bond Sales

Washington, D.C. — The Financial Industry Regulatory Authority (FINRA) announced today that it has fined Edward D. Jones & Co., L.P. of St. Louis $900,000 for its failure to timely deliver official statements to customers who purchased new-issue municipal securities and related supervisory and recordkeeping failures.
 
With limited exceptions, broker-dealers selling a new-issue municipal securities are required under the rules of the Municipal Securities Rulemaking Board (MSRB) — which are enforced by FINRA — to deliver a copy of the official statement to the customer on or before settlement date. New-issue securities are those sold during the initial distribution of bonds to the public.
 
"Official statements contain important financial information for investors about the issuing municipality and the bonds they are purchasing," said Susan L. Merrill, FINRA Executive Vice President and Chief of Enforcement. "This firm was consistently late in delivering those statements even though it was repeatedly on notice about its delivery failures."
 
FINRA found that Edward Jones's late deliveries occurred when the firm was conducting retail transactions but was not a member of the underwriting syndicate for a new issue.
 
FINRA further found that the firm's failures from 2002 through 2006 were systemic. During that time period, Edward Jones engaged in approximately 100,000 new-issue municipal bond transactions in which it was not an underwriter. For a significant number of those transactions, the firm was late in delivering official statements to its customers. The firm's systemic late deliveries had multiple causes, including lack of training for employees, incorrect instructions to employees, limited photocopying capacity and errors by employees of the firm, including trading supervisors.
 
The late deliveries continued. In September 2008 alone, the firm was late in mailing official statements to customers in over 6,200 transactions, which represented 19 percent of the firm's municipal bond transactions covered by the applicable MSRB rule.
 
FINRA further found that Edward Jones's own internal communications repeatedly referenced that it was not timely delivering official statements. Nevertheless, the firm failed to take reasonable and sufficient steps to comply with its delivery obligations.
 
FINRA also found that Edward Jones failed to keep required records, did not have written supervisory procedures addressing the requirements for delivery of official statements until May 2006, and that those procedures contained incorrect guidance. As part of the settlement, an officer of Edward Jones will certify that it has adopted and implemented systems and procedures reasonably designed to ensure compliance with MSRB rules, including systems and procedures to provide adequate oversight if third party vendors are utilized.