Schwab’s $200 Million Charge Puts Scrutiny on Robo-Advising

When Charles Schwab Corp. launched its robo-adviser service in 2015, the company said it would be a smart, low-cost and handsfree solution that would automatically invest clients’ money in various exchange-traded funds.

The product, Schwab Intelligent Portfolios, was part of a crop of new offerings from brokerages that raced to sign up clients after the financial crisis, long before most people could trade stocks from their phones. And it has delivered for the brokerage, gathering almost $64 billion in client assets as of the end of March.

Now, new questions are being raised about the Westlake, Texas, brokerage’s practices after ...