Ameriprise Financial Services has agreed to pay a fine of $4.5m imposed by the US Securities and Exchange Commission (SEC) to settle charges over failing of safeguarding client assets.
Image: The US SEC has fined Ameriprise Financial Services for failing to safeguard client assets. Photo: courtesy of Jason Morrison / FreeImages.
Ameriprise has been charged due to the failure of safeguarding retail investor assets from theft by its representatives.
As per the SEC’s order, the five representatives from Ameriprise committed multiple fraudulent acts, comprising of forging client documents and theft of more than $1m in retail client funds over a four-year period.
The regulator noticed that Ameriprise failed to adopt and implement policies and procedures for safeguarding investor assets against misappropriation by its representatives.
Ameriprise is a registered investment adviser and broker-dealer
Ameriprise’s five representatives were from Minnesota, Ohio, and Virginia, and three of them were earlier also imposed with criminal charges.
The SEC’s order found that Ameriprise has implemented a new system to safeguard clients’ money and reimbursed all impacted clients for the losses they incurred because of misconduct of the five representatives.
SEC’s enforcement division assistant director Fuad Rana said: “A critical obligation of an investment adviser is to safeguard investor assets.
“Ameriprise failed to meet that obligation and as a consequence was unable to prevent the theft of its clients’ assets.”
The regulator has fined Ameriprise for failing to design proper policies and procedures to avoid its representatives from misappropriating client funds, as well as for failing to reasonably monitor the five representatives.
Ameriprise agreed to be censured and pay a penalty without admitting or denying the findings, said SEC.
The SEC’s investigation was carried out by Norman Knickle and supervised by Rana, and also supported by Thomas Meier, Josh Herbst, and Susan Weis from the Chicago Regional Office’s examination staff.
Ameriprise Financial provides financial planning, investments, products and services, including wealth management, asset management, insurance and annuities.
The company will advise on insurance and annuity products such as life, disability income, auto and home and long-term care insurance, as well as annuities for retirement income.
In addition, the firm provides professional fiduciary services, and advises on multiple investment options and brokerage account types.