The SEC charged mutual fund giant, Vanguard Advisers, Inc., which manages more than $300 billion in RAUM, for failing to adequately disclose conflicts of interest related to incentive fees paid to its financial advisors in connection with recommending that clients enroll in a fee-based Personal Advisor Services ("PAS") managed account program, that included initial investment advice and ongoing portfolio management of their accounts. The incentives were based on various metrics for initial enrollment and retention in the program and provided for bonuses and merit increases for eligible advisors. While Vanguard's Form ADV Part 2 disclosed that some PAS advisors were eligible for a discretionary bonus that created a financial incentive for the advisors to recommend the PAS program over other advisory programs and brokerage services, the firm made contradictory statements in Form CRS and marketing materials, noting that PAS advisors received no outside compensation of financial incentives. The SEC noted that the firm's website described PAS advisors as salaried advisors who do not work on commissions and “have no financial incentives to recommend certain products” and noted that such individuals had “no outside incentives, so they’ll always put your interests first.” Vanguard agreed to a penalty of nearly $20 million.