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Charles Schwab says SEC investigating robo adviser disclosures, warns of Q2 results hit

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FILE PHOTO: The seal of the U.S. Securities and Exchange Commission (SEC) is seen at their headquarters in Washington, D.C.
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(Reuters) - Charles Schwab Corp on Friday revealed an investigation by the U.S. Securities and Exchange Commission (SEC) related to historic disclosures involving Schwab Intelligent Portfolios, the retail brokerage's robo adviser.

The company warned its second quarter financial results would include a charge of $200 million, but the ultimate liability could differ, depending on the outcome of the matter.

The retail brokerage said it had been cooperating with the SEC staff in the investigation and is "evaluating its options." https://bit.ly/2SFMqHq

Schwab's robo adviser or automated investment product distributes cash among exchange-traded funds according to formulas based on client questionnaires and allocated almost $64 billion in client assets by the end of March.

"The company intends to continue cooperating with the SEC with the goal of resolving this matter," Schwab said.

(Reporting by Noor Zainab Hussain in Bengaluru; Editing by Vinay Dwivedi)