SEC: Financial Advisor Ameriprise To Pay $4.5M Fine


The U.S. Securities and Exchange Commission (SEC) announced, according to Reuters, that it has charged Ameriprise Financial, a registered investment advisor and broker-dealer, $4.5 million due to the company’s failure to safeguard retail investor assets from theft by its representatives. According to the SEC’s order, five Ameriprise representatives committed numerous fraudulent acts, including forging client documents, and stole more than $1 million in retail client funds over a four-year period.

Though the representatives have been terminated by Ameriprise for misappropriating client funds, the SEC found that the company failed to have reasonably designed policies and procedures to prevent its representatives from misappropriating client funds, as well as did not reasonably supervise the five representatives.

“A critical obligation of an investment advisor is to safeguard investor assets,” said Fuad Rana, an assistant director in the SEC’s Division of Enforcement, in a press release. “Ameriprise failed to meet that obligation and, as a consequence, was unable to prevent the theft of its clients’ assets.”

The SEC investigation was conducted by H. Norman Knickle and supervised by Rana. There was also assistance from Thomas Meier, Josh Herbst and Susan M. Weis of the Chicago Regional Office’s examination staff.

The five representatives were based in Minnesota, Ohio and Virginia, and the SEC revealed that three have already pled guilty to criminal charges. Without admitting or denying the findings, Ameriprise agreed to be censured and pay a penalty of $4.5 million. In addition, the company has implemented a new system to protect clients’ money, and has reimbursed all of its clients that were impacted by the misconduct.

“The actions of these five individuals were in clear violation of our policies and resulted in their immediate separation from the firm. We fully reimbursed clients who were impacted after the activity was discovered,” said an Ameriprise statement, according to Reuters.