8-KOther Events

SCHWAB CHARLES CORP 8-K Report, Corporate Update (Jan 18, 2011)

Filed January 18, 2011For Securities:SCHWSCHW-PDSCHW-PJ

Summary

The Charles Schwab Corporation (SCHW) filed an 8-K on January 17, 2011, to report on significant regulatory settlements. The company announced that two of its subsidiaries have resolved investigations by the U.S. Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and Illinois regulators concerning the Schwab YieldPlus Fund. As part of these settlements, Schwab has agreed to a total payment of $119 million. The company anticipates recognizing an after-tax charge of $97 million in its fourth quarter financial results for the period ending December 31, 2010, to cover these settlement costs. The settlement with the SEC is contingent on approval from the U.S. District Court for the Northern District of California.

Key Highlights

  • 1The Charles Schwab Corporation's subsidiaries have entered into settlement agreements with the SEC, FINRA, and Illinois regulators.
  • 2These settlements resolve previously disclosed investigations into the Schwab YieldPlus Fund.
  • 3The total payment agreed upon across all regulatory bodies is $119 million.
  • 4Schwab expects to record an after-tax charge of $97 million related to these settlements.
  • 5This charge will be included in the company's fourth quarter financial results.
  • 6The SEC settlement requires approval from the U.S. District Court for the Northern District of California.
  • 7The report was filed on January 17, 2011, with the earliest event reported on January 11, 2011.

Frequently Asked Questions

This 8-K filing announces that two subsidiaries of The Charles Schwab Corporation have reached settlement agreements with the SEC, FINRA, and Illinois regulators regarding investigations into the Schwab YieldPlus Fund.

Schwab has agreed to pay a total of $119 million to the regulators. The company expects to record an after-tax charge of $97 million in its fourth quarter financial results to account for these settlement costs.

The settlement agreements were made with the U.S. Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and Illinois regulators.

Yes, the settlement amounts payable to the SEC are subject to the approval of the U.S. District Court for the Northern District of California.