Raymond James Financial, Inc. is an American multinational independent investment bank and

financial services Financial services are the economic services provided by the finance industry, which encompasses a broad range of businesses that manage money, including credit unions, banks, credit-card companies, insurance companies, accountancy companie ...

company providing financial services to individuals, corporations, and municipalities through its subsidiary companies that engage primarily in investment and

financial planning In general usage, a financial plan is a comprehensive evaluation of an individual's current pay and future financial state by using current known variables to predict future income, asset values and withdrawal plans. This often includes a bud ...

, in addition to

investment banking Investment banking pertains to certain activities of a financial services company or a corporate division that consist in advisory-based financial transactions on behalf of individuals, corporations, and governments. Traditionally associated with ...

and

asset management Asset management is a systematic approach to the governance and realization of value from the things that a group or entity is responsible for, over their whole life cycles. It may apply both to tangible assets (physical objects such as buildings ...

. Headquartered in St. Petersburg, Florida, Raymond James is one of the largest banking institutions in the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 U.S. state, states, a Washington, D.C., federal district, five ma ...

History

Raymond James was founded in 1962 when St. Petersburg broker,

Robert James Robert James may refer to: *Robert James (actor) (1924–2004), Scottish actor *Robert James (businessman) (died 1983), American founder of Raymond James Financial * Robert James (defensive back) (born 1947), played in the National Football League, ...

, formed Robert A. James Investments. In 1964, it merged with Raymond & Associates, founded by Edward Raymond in 1963, to form Raymond James & Associates. Robert James' son,

Tom James Thomas James MBE (born 11 March 1984) is a British rower, twice Olympic champion and victorious Cambridge Blue. In a British coxless four in 2012 he set a world's best time which still stood as of 2021. Background and early life James was born ...

, joined in 1966 and assumed leadership of the firm in 1970. The firm planned to go public in 1969, but market conditions delayed its plan until 1983. Tom turned over the CEO's post to Paul Reilly in 2010, and his title as Chairman of the Board to Paul Reilly in 2016. He remains on the leadership team as Chairman Emeritus. In 2012, the firm purchased the Canadian assets of Allied Irish Bank. In April 2012, they merged with Morgan Keegan & Company, creating one of the country's largest full-service

wealth management Wealth management (WM) or wealth management advisory (WMA) is an investment advisory service that provides financial management and wealth advisory services to a wide array of clients ranging from affluent to high-net-worth (HNW) and ultra-high ...

and investment banking firms not headquartered in New York. As of the fiscal quarter ending September 30, 2021, the firm had delivered 135 consecutive quarters of profitability. In June 2016, it was listed as a ''Fortune'' 500 company for the first time. In September 2016, the firm announced its acquisition of Deutsche Bank Wealth Management's US private client services unit,

Alex Brown & Sons Alex. Brown & Sons was the first investment bank in the United States, founded by Alexander Brown in 1800 in Baltimore, Maryland. The firm was acquired by Bankers Trust in 1997 to form BT Alex. Brown, and then integrated into Deutsche Bank in 1 ...

. As of September 30, 2021, Raymond James has approximately 8,400 financial advisors throughout the United States, Canada and overseas. Total client assets under management are approximately $1.18 trillion.

Current operations

Raymond James has four main lines of operation: private client group, capital markets (made up of equity and fixed income capital markets as well as public finance), asset management group (made up of asset management services and Carillon tower advisers) and banking.

Controversies

''SEC v. Dennis Herula''

In 2004, the SEC fined Raymond James Financial Services, Inc. $6.9 million for failure to supervise former broker Dennis Herula. Herula was accused of participating with others in a

Ponzi scheme A Ponzi scheme (, ) is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. Named after Italian businessman Charles Ponzi, the scheme leads victims to believe that profits are comi ...

that raised about $44.5 million from investors in 1999-2000. Herula himself raised about $16.5 million of investor funds, most of which was later transferred to his wife's brokerage account at Raymond James. He was arrested in Bermuda and pleaded guilty to criminal charges of wire fraud and sentenced to 188 months in prison.

Supervision of branch managers

In 2005, the National Association of Securities Dealers fined Raymond James $2.75 million for lax supervision of producing branch managers. The investigation began with one Raymond James manager, who worked from an office in her Wisconsin home, handling approximately 700 accounts and selling mainly mutual funds and variable annuities. The Wisconsin manager was accused of selling unsuitable aggressive mutual funds and variable annuities over a four-year period.

Auction rate securities

On June 29, 2011, Raymond James announced an agreement to repurchase at par

auction rate securities An auction rate security (ARS) typically refers to a debt instrument (corporate or municipal bonds) with a long-term nominal maturity for which the interest rate is regularly reset through a Dutch auction. Since February 2008, most such auctions ...

(ARS) sold to clients through its domestic broker/dealer subsidiaries prior to February 13, 2008. The agreement—reached with the

Securities and Exchange Commission The U.S. Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929. The primary purpose of the SEC is to enforce the law against mark ...

and with state securities regulators led by Florida and Texas—resolved more than three years of investigation related to activity in the ARS market. Without admitting or denying the allegations, the firm also agreed to pay a fine totaling $1.75 million to the state regulators, but was not fined by the SEC. As a result of this agreement, a pre-tax charge of $45 million was recorded in the quarter ending June 30, 2011. This charge was a result of an estimate of the current fair value of the securities to be repurchased by the company being less than their par value. It is expected that the ultimate realized loss will be substantially less as issuers refinance or redeem these securities, interest rates rise and/or collateral values improve. Raymond James sold $2.3 billion worth of ARS, underwrote $1.2 billion, and was the auction dealer for over $725 million. Since the $330 billion market for ARS crashed in 2008, at least 19 underwriters and broker-dealers were sued in

class action A class action, also known as a class-action lawsuit, class suit, or representative action, is a type of lawsuit where one of the parties is a group of people who are represented collectively by a member or members of that group. The class action ...

suits.

Excessive commissions

In September 2011, the

Financial Industry Regulatory Authority The Financial Industry Regulatory Authority (FINRA) is a private American corporation that acts as a self-regulatory organization (SRO) that regulates member brokerage firms and exchange markets. FINRA is the successor to the National Associat ...

ordered Raymond James & Associates, Inc. and Raymond James Financial Services, Inc. to pay restitution of $1.69 million to 15,500 of their clients for charging excessive commissions on more than 27,000

securities A security is a tradable financial asset. The term commonly refers to any form of financial instrument, but its legal definition varies by jurisdiction. In some countries and languages people commonly use the term "security" to refer to any fo ...

transactions. The trades were made in client accounts between 2006 and 2010. FINRA also fined RJA $225,000 and RJFS $200,000.

Notable FINRA Fines

On May 18, 2016 Raymond James was fine
$17 Million for Systemic Anti-Money Laundering Compliance Failures
"RJA was fined $8 million and RJFS was fined $9 million for failing to establish and implement adequate AML procedures, which resulted in the firms’ failure to properly prevent or detect, investigate, and report suspicious activity for several years. RJA's former AML Compliance Officer, Linda L. Busby, was also fined $25,000 and suspended for three months.". On December 21, 2017 Raymond James was fine
$2 million for failing to reasonably supervise email communications
"FINRA found that during a nine-year review period, Raymond James’ email review system was flawed in significant respects, allowing millions of emails to evade meaningful review. This created the unreasonable risk that certain misconduct by firm personnel could go undetected by the firm. The combinations of words and phrases – otherwise known as the “lexicon” – used to flag emails for review were not reasonably designed to detect certain potential misconduct that Raymond James, in light of its size, structure, business model, and experience from prior disciplinary actions, knew or should have anticipated would recur from time to time. The firm also failed to devote adequate personnel and resources to the team that reviewed emails flagged by the system, even as the number of emails increased over time."

References

External links

* {{Authority control Companies listed on the New York Stock Exchange Companies based in St. Petersburg, Florida American companies established in 1962 Financial services companies established in 1962 Investment banks in the United States