The client alleges misrepresentations concerning the purchase of a variable annuity.

After completion of the firm's investigation into client's allegations, claim was denied.

CLIENT CLAIMS SHE BROUGHT MONEY INTO EDWARD JONES WITH THE INTENTION OF PURCHASING A CD. CLIENT INDICATES SHE PLANNED TO PURCHASE A HOME IN SPRING/SUMMER 2009. CLIENT STATES AFTER MEETING WITH THE FA, SHE CAME OUT OWNING CLASS A MUTUAL FUNDS. CLIENT INDICATES HER GOALS WERE SHORT TERM AND SHE SAID SUZY ORMAN SAID CDS ARE FOR SHORT TERM. CLIENT CLAIMS FA INFORMED HER CDS DOES NOT KEEP UP WITH THE RATE OF INFLATION. ACCOUNT HAS TRANSFERRED, BUT LOSSES AT THE END OF HER AUGUST ACCOUNT STATEMENT EXCEEDED $5,000.

$5,000.00

FA RELATED THAT HE FIRST BECAME ACQUAINTED WITH CLIENT IN MAY 2008 AND HE LEARNED THE CLIENT HAD $80,000 IN A CD AT SUNTRUST BANK AND THAT SHE OWNED AMERICAN FUNDS AND LORD ABBETT CLASS C SHARE MUTUAL FUNDS THROUGH ANOTHER BROKER DEALER. FA DETERMINED THROUGH DISCUSSIONS WITH THE CLIENT THAT SHE HAD THE RIGHT PERCENTAGE OF SHORT-TERM MONEY IN AN AMERICAN FUNDS MONEY MARKET ACCOUNT. HE UNDERSTOOD CLIENT WAS NOT BRINGING ALL OF HER BANK ASSETS TO EJ. FA DISCUSSED WITH THE CLIENT DIFFERENT ASSET CATEGORIES AND THE RISKS OF EACH. AFTER GATHERING PERTINENT INFORMATION REGARDING CLIENT'S BACKGROUND AND INVESTMENT OBJECTIVES (BALANCED TOWARD GROWTH AND INCOME) FA RECOMMENDED THE PURCHASE OF CLASS A SHARES IN FOUR AMERICAN FUNDS TO COMPLEMENT THE CLIENT'S EXISTING HOLDINGS IN AMERICAN FUNDS CLASS C SHARES. THE FA DID EVALUATE SHARE CLASS SUITABILITY BY RUNNING MORNINGSTAR HYPOTHETICAL ILLUSTRATIONS. THE ILLUSTRATIONS CLEARLY SHOWED THAT COMPARED TO CLASS C SHARE, CLASS A SHARES WERE THE MOST SUITABLE CHOICE GIVEN A HOLDING PERIOD OF 5-10 YEARS OR MORE. GIVEN CLIENT'S PRIOR MUTUAL FUND INVESTMENT EXPERIENCE IT IS OUR OPINION THAT CLIENT KNEW AND UNDERSTOOD THE RISKS ASSOCIATED WITH THE PURCHASE OF MUTUAL FUNDS. CLIENT WAS PROVIDED WITH TRADE CONFIRMATIONS AND ACCOUNT STATEMENTS THAT PROVIDED FULL DISCLOSURE OF THE ACTIVITY IN THE CLIENT'S ACCOUNT. BASED ON OUR REVIEW, IT IS OUR OPINION THAT THE MUTUAL FUNDS WERE PURCHASED WITH THE CLIENT'S KNOWLEDGE AND AUTHORIZATION. IN ADDITION, IT APPEARS THE RECOMMENDATIONS WERE MADE IN GOOD FAITH BASED ON THE INFORMATION AVAILABLE TO THE FA AT THE TIME OF PURCHASE. AS A RESULT OF OUR REVIEW, WE RESPECTFULLY DECLINE CLIENT'S REQUEST FOR COMPENSATION RELATED TO THIS MATTER.