Complaint Claims Osaic’s Practices Enrich the Company at Expense of Customers
WASHINGTON – February 6, 2025 – DiCello Levitt has filed a class action lawsuit against Osaic Holdings, Inc., Osaic, Inc., Osaic Services, Inc., and Osaic Wealth, Inc. alleging the companies have breached their fiduciary duties by profiting from their cash sweep program at their account holders’ expense.
The complaint, filed in the United States District Court for the District of Arizona, claims that Osaic’s cash sweep programs, whereby customers’ uninvested cash is automatically swept into interest-bearing accounts, is structured to enrich Osaic at the expense of its own clients. The cash sweep programs have been specifically designed to benefit the company and its network of banks by paying unreasonably low interest rates to customers while keeping the difference, or “spread,” for themselves. Osaic disguises the returns it keeps as “fees,” but in reality, it has been receiving the rates of interest on its customers’ cash that the customers are rightfully entitled to.
“Osaic has a legal obligation to act in the best interest of its customers, but has continued to breach that duty by putting its own best interests ahead of its clients,” said DiCello Levitt Partner Brian O’Mara. “After an extensive investigation into Osaic’s conduct, DiCello Levitt is leading the effort to prevent the company from continuing to enrich itself at the expense of its customers. Our goal is to hold Osaic accountable, recover the financial losses experienced by our client and other customers, and reclaim the unjust gains made by Osaic. We hope others who may have been impacted by Osaic or other financial institutions’ cash sweep programs also come forward.”
The class action seeks to represent a nationwide class of U.S.-based account holders who have been affected by Osaic’s practices. The lawsuit alleges violations of fiduciary duties, gross negligence, unjust enrichment, and violations of the Investment Advisers Act of 1940. The plaintiffs seek damages, restitution, injunctive relief, and other equitable relief.
The case is Gehring v. Osaic Holdings Incorporated et al, Case No. 2:25-cv-00367-KML. A copy of the complaint is available here.
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Media Contact Caitlin Whitehurst, Director of Communications, [email protected]