New York robo-adviser Betterment will be scrutinised by Massachusetts’ securities regulator following its decision to delay Brexit trading. The adviser failed to forewarn its retail investors of the delay, leading to accusations of preferential treatment for its Betterment Institutional clients. In a letter sent on Friday morning, the Massachusetts Securities Commission (SEC) said it was investigating whether Betterment’s “lack of disclosure” about the timing and extent of the delay constituted an illegal breach The outcome of the scrutiny will set a precedent for the rest of the digital advice industry.
New York robo-adviser Betterment will be scrutinised by Massachusetts’ securities regulator following its decision to delay Brexit trading. The adviser failed to forewarn its retail investors of the delay, leading to accusations of preferential treatment for its Betterment Institutional clients. The company has been mandated to change its client communication policies and inform the regulator by the end of the month. The outcome of the scrutiny will set a precedent for the rest of the digital advice industry.