Transamerica Financial Advisors agreed to pay $1.1 million to settle the Securities Exchange Commission's  allegations the St. Petersburg, Fla.-based firm improperly calculated advisory fees and overcharged its clients.

As part of Thursday’s settlement, Transamerica agreed to a censure without admitting or denying the SEC’s findings. The firm also agreed to pay a $553,624 civil money penalty to the SEC, as well as reimburse 2,304 current and former client accounts with refunds and credits totaling $553,624 including interest. Transamerica did not immediately respond to a request for comment. 

“Transamerica failed to properly aggregate client accounts so that they could receive a fee discount, and this systemic breakdown caused retail investors to overpay for advisory services in thousands of client accounts,” Julie M. Riewe, co-chief of the SEC Enforcement Division’s Asset Management Unit, said in a statement Thursday.

According to the regulator, Transamerica—which has $3.1 billion in assets under management—failed to apply the breakpoint discounts promised to clients when they increased their assets in several investment programs, including the TFA Advantage Account, TFA Capital Account and TFA Sterling Advisory Account programs.

The breakdown started in January 2009. But when SEC examiners first alerted the firm about the aggregation problems in 2010 after an examination of a branch office, Transamerica failed to take firm-wide action, according to the regulator. Transamerica issued refunds to clients of that branch office, but SEC examiners found that Transamerica was still failing to aggregate certain related client accounts in 2012.  Examiners concluded the issue persisted beyond any one branch office.

“Transamerica failed to take appropriate remedial steps even after SEC examiners had flagged the problem," Eric I. Bustillo, director of the SEC’s Miami Regional Office, said in a statement.

In addition to the civil penalty and client reimbursements, Transamerica agreed to hire an independent consultant to review its policies and procedures around account opening forms, fee schedules, and fee computation methodologies, as well as the firm’s account aggregation process for breakpoints.