Betterment to Pay SEC $9 Million to Settle Tax Harvesting Case

Robo-adviser company Betterment will pay a $9 million penalty to the SEC for “material misstatements and omissions related to its automated tax loss harvesting service.”

• “Betterment failed to disclose a change in the software related to its scanning frequency, failed to disclose a programming constraint affecting certain clients, and had two computer coding errors that prevented TLH from harvesting losses for some clients”
• SEC said issues adversely impacted more than 25,000 client accounts, resulting in those clients losing about $4 million in potential tax benefits

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