Fraud Alert: Ameriprise Financial Fined $850K for Failure to Supervise

A September 14, 2016 News Release reports that The Financial Industry Regulatory Authority (FINRA) fined Ameriprise Financial Services, Inc. $850,000 for failure to supervise.

FINRA found a failure to supervise the transmission of funds from Ameriprise’s customer brokerage accounts.  FINRA found that a Registered Representative of Ameriprise, who worked as both a sales assistant and office manager, converted more than $370,000 from five customer brokerage accounts without detection for two years.  The conversion began in October 2011 and continued undetected until September 2013.

A simple two step process allowed the representative to covert funds of his own family members.  These family member included his mother, stepfather, grandparents and domestic partner.  The lack of an established supervisory system and failure to supervise by Ameriprise led to inadequately investigating red flags associated with nine third-party wire request that would have uncovered the misconduct.

“Ameriprise neither admitted or denied the charges, but consented to the entry of FINRA’s findings” and paid restitution, plus interest and related fees, to the customers.  Click HERE to read the entire FINRA release.


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