fi360 Fiduciary Talk 32: Reverse Churning and How the DOL Addresses the Problem Under the New DOL Rule

What is Reverse Churning? This is the opposite of excessive trading in a brokerage account. These are illegal practices that pad an unethical advisors wallet. Reverse Churning occurs when an advisor places the clients assets in an advisory account, and charges an on going management fee and they get paid for not providing enough services that justify that compensation that comes in on that fee fee basis.