The SEC announced that Ameriprise Financial Services Inc. will pay $4.5 million to settle charges that it failed 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. The SEC found that Ameriprise -- which did not admit or deny the findings -- failed to adopt and implement policies and procedures reasonably designed to safeguard investor assets against misappropriation by its representatives. The SEC also found that Ameriprise has implemented a new system to safeguard clients’ money and has reimbursed all affected clients for the losses they incurred.
Meanwhile, an article by a team of Dechert lawyers explores disciplinary and enforcement actions taken against brokers, investment advisers and funds in the last few years related to conflicts of interest, sales charge waivers and other mutual fund sales practices. Given the recent regulatory actions regarding the SEC’s best interest proposal and the demise of the DOL Fiduciary Rule, the future of fund distribution and the structures of mutual fund share classes remain uncertain, they wrote. “Regardless of the ultimate outcome of these regulatory initiatives, the fiduciary duties of investment advisers and duties of intermediaries are areas on which regulators are, and will likely continue to be, focused,” the lawyers cautioned.