Ameriprise Financial, Inc.
Shepherd Smith Edwards & Kantas has represented many consumers over the years against Ameriprise Financial, Inc. and the financial advisors employed by them.Ameriprise Financial: Broker-Dealer Background Information
Ameriprise Financial is a financial services corporation and holding company. The entity has its headquarters in Minneapolis, Minnesota but is incorporated in Delaware. Ameriprise provides standard brokerage and financial advisory services. Most advisors at this broker-dealer operate as individual offices generally maned by a single agent.
Sometimes there will be junior brokers under the main agent who runs the office. These offices are usually self-supervised with no onsite compliance personal. Like most broker-dealers, Ameriprise provides recommendations on stocks, bonds, mutual funds, insurance, annuities, and private placements.
It is estimated that over 85% of the company's revenues came from managing client wealth. Subsidiaries of Ameriprise include RiverSource Life Insurance Company, Columbia, which provides investment advisory services to institutional clients, and Ameriprise Financial Services.
It ranks 249th on the Fortune 500 and is also listed as one of the largest banks in the U.S. Based on the gauge of the amount of assets it manages, Ameriprise is ranked ninth as an independent brokerage house. It is also considered to be one of the larger financial planning entities in the U.S., in general, and in the top twenty-five world-wide.
Ameriprise has been around in one form or another since 1894. Its original name was Investors Syndicate and it started in Minneapolis.
In 1925, the entity merged with another business owned by J. R. Ridgway and grew larger. During this period, I.S. created one of the first mutual funds. It eventually became the largest balanced fund available. By 1949. I.S. officially changed its name to Investors Diversified Services, Inc. and was commonly known as IDS.
It largely operated as a family-owned business till the year 1979. The Ridgways sold the family's interest and IDS merged with another entity. American Express eventually purchased IDS in the mid-80s. A decade later the firm's name was changed again to American Express Financial Advisors. Finally, in the year 2005, Amex spun-off the entity as a separate corporation known as Ameriprise.Ameriprise Involved in Numerous Regulatory Complaints
Currently, Ameriprise has 78 Regulatory complaints against it by various State Regulatory bodies, the SEC, and FINRA.
For example, the State of New Jersey investigated Ameriprise on the issue of improper sales of AIS or alternative investments which the state defined as Non-Traded REITs and business development corporations (BDCs). A BDC is an entity that invests in start-ups and distressed businesses. Many seasoned advisors consider AIS to be risky and not suitable for conservative/moderate investors.
New Jersey goes on to say that during the years 2010 and 2015 Ameriprise neglected to reasonably supervise the purchases of AIS in the state. Ameriprise also neglected to ensure the suitability requirements as promulgated by New Jersey on the issue of prospectuses, prospectus protocols, and also Ameriprise's written supervisory procedures.
It was further stated that the broker-dealer failed to properly calculate consumer liquid net worth which improperly enabled the AIS transactions to take place. As a result, Ameriprise paid $375,000 to the state New Jersey which included a fine of $150,000; costs of $150,000; and $75,000 allocated towards investor education.
Technically, Ameriprise never denied the allegations, nor did they admit to them.SEC Admonished Broker-Dealer for Failure to Protect Consumer Assets
The SEC also admonished Ameriprise for failure to put in place protocols that were designed to reasonably protect consumer assets against expropriation by Ameriprise agents.
Between 2011 and 2014, Ameriprise Financial instituted a system, required for compliance purposes, automated in nature, to properly surveil and identify if an agent perpetrated stockbroker fraud by acquiring funds from consumer accounts.
According to the SEC, the systems were flawed in that they did not operate properly or had other limitations. The SEC concluded over $1,00,000 in funds was improperly extracted by Ameriprise agents. As a result, the SEC instituted a monetary penalty of $4,500,000 which was paid to the SEC. As is common, the broker-dealer consented to the fine but was able to do so without admitting or denying the SEC's conclusions.Are You a Victim of Securities Fraud? Get Legal Advice Today
If you suffered losses utilizing an Ameriprise advisor, please contact our securities attorneys at the firm of Shepherd Smith Edwards & Kantas. We have filed many cases for clients who have unnecessarily sustained losses through this broker-dealer and its agents.
As stated above, many agents involved with this firm are generally unsupervised on-premise. As such, clients can be taken advantage of by unscrupulous brokers. In recent years Ameriprise and/or its agents have recommended and concentrated, in many instances, client assets in privately traded investments such as REITs, MLPs, or BDCs.