Delaware’s Attorney General has secured a settlement worth more than $1 million with Fairfield-based Cambridge Investment Research, Inc. and its affiliated advisory firm over supervisory failures related to the termination of a formerly affiliated financial professional and the transition of his clients to another adviser.
Attorney General Kathy Jennings announced the settlement with Cambridge Investment Research, Inc. and Cambridge Investment Research Advisors, Inc. on October 16. The consent order was entered October 9 by the director of Delaware’s Investor Protection Unit.
Under the terms of the settlement, Cambridge will pay $950,000 in penalties and $50,000 in costs to the state, and $52,465 in restitution to clients whose advisory accounts were not properly monitored following the former adviser’s departure. Cambridge consented to the order without admitting or denying the findings.
The investigation focused on Cambridge’s handling of a financial professional’s termination and the subsequent transition of his clients to another adviser at the firm. According to the consent order, after the former adviser’s departure in June 2021, Cambridge failed to maintain supervisory systems that would have prevented him from continuing to assist clients using Cambridge’s platforms and personnel for up to a year. Some of the former adviser’s clients were unaware he had left the firm until he transferred their accounts to a new firm — in some cases nearly a year after his departure.
The Investor Protection Unit also found supervisory lapses in how Cambridge communicated the termination to clients. The unit found that Cambridge failed to sufficiently notify clients that the former adviser had been terminated from the advisory side of the firm, and that client letters sent at the time of his departure contained inaccurate or incomplete information. Additionally, the transition of certain client accounts to a new financial professional at the firm left some accounts unmanaged for nearly a year despite continued advisory fee payments.
“My office will not stand idly by when investment advisers fail to enforce basic safeguards and put the financial welfare of Delawareans at risk,” Jennings said. “This settlement reflects our commitment to holding these firms accountable for their actions and ensuring that Delaware investors are protected from improper unregistered activity.”
The settlement follows a November 2025 consent order with Kovack Advisors, Inc., which resulted in $995,180 in penalties including for supervisory violations, which the Delaware Department of Justice cited as evidence of its continued focus on supervisory failures in the securities industry.
Cambridge Investment Research is headquartered in Fairfield, Iowa. The firm neither admitted nor denied the findings as part of the settlement. Ottumwa Radio reached out to Cambridge for comment but did not receive a response before publication.
