\t\t\t\tIn a civil case that is still underway, a number of Ameriprise Financial Inc. workers are suing their employer for what they claim was $20 million in excessive costs that resulted because the company put their 401(k) contribution in proprietary funds. The complaint, filed in September in the U.S. District Court in Minnesota last September, has been seeking class action status. <\/p>\n
The 401k plan under dispute was launched in 2005 and the class action securities lawsuit is looking to represent everyone that the plan has employed since then. Over 10,000 members may qualify to become part of the class. The group is led by several former and current Ameriprise plan participants. <\/p>\n
Also named as defendants in this civil suit are Ameriprise’s 401(k) investment committees and employee benefits administration. According to the plaintiffs, the defendants violated their fiduciary obligation to the retirement plan, which included investments involving mutual funds and target date funds from RiverSource Investment LLC (an Ameriprise subsidiary that is now called Columbia Management Investment Advisers LLC). The plaintiffs say that about $500 million in plan assets went into Ameriprise Trust Co. and RiverSource yearly. <\/p>\n
The plaintiffs claim that the investment that their money went into resulted in fees generated for Ameriprise Trust, RiverSource, and its affiliates. The Ameriprise workers say that the plan suffered over $10 million in losses due to excessive fees and expenses. They also believe that RiverSource was behind in their benchmarks, suffered outflows in the billions of dollars in 2006 and 2005, and was given poor ratings by Morningstar Inc.<\/p>\n
The plaintiffs believe that defendants selected the more costly funds with the poorer performance stories to create revenue for ATC and RiverSource and that this also benefited Ameriprise. They say that Ameriprise violated its fiduciary duty, under the Employee Retirement Income Security Act of 1974, to the retirement fund. <\/p>\n
The plaintiffs are seeking disgorgement of all revenues, restitution, and all the money that was lost. They want the court to make sure the plan’s losses are paid back and participants are placed in the position they would have been in if only the plan had been administered correctly.<\/p>\n
401K Plan Lawsuits<\/strong> There have ben other employees of other companies that have also filed their 401(k) fees class action lawsuits. For example, just last December, Walmart settled a $13.5 million class action complaint with its employees. The lawsuit blamed the company and Bank of America<\/a>‘s Merrill Lynch<\/a> unit for passing along expenses and high fees that were unreasonable to some two million workers. <\/p>\n Ameriprise workers sue over company’s own 401(k) funds<\/a>, Investment News, September 29, 2011 <\/p>\n Ameriprise workers seek class-action suit on 401(k), Star Tribune, September 29, 2011 <\/p>\n Ameriprise Broker Arrested for Defrauding Investors – Clients Say He Cashed Checks Made Out to Ameriprise<\/a>, Stockbroker Fraud Blog, July 7, 2007 In a civil case that is still underway, a number of Ameriprise Financial Inc. workers are suing their employer for what they claim was $20 million in excessive costs that resulted because the company put their 401(k) contribution in proprietary funds. The complaint, filed in September in the U.S. District Court in Minnesota last September, […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3791,3752],"tags":[2547],"class_list":["post-1043","post","type-post","status-publish","format-standard","hentry","category-ameriprise-securities-america","category-financial-firms","tag-401k-lawsuits"],"yoast_head":"\n
\nThere are fiduciaries and owners of businesses that could find themselves in legal hot waters in the wake of the Department of Labor regulations that now require that the hidden, excessive fees in 401(k) plans be disclosed. Unbeknownst to participants, these fees have been reducing retirement plan balances. Also, the government is now pushing for full disclosure of all fees and wants retirement plan offerings to be provided to employees at the lowest costs possible. <\/p>\n
\nMore Blog Posts:<\/strong>
\nAmeriprise to Sell Securities America Even as it Finalizes Securities Settlement with Investors of Medical Capital Holdings and Provident Royalties Private Placements<\/a>, Stockbroker Fraud Blog, April 26, 2011 <\/p>\n
\nBank of America to Pay $335M to Countrywide Financial Corp. Borrowers Over Allegedly Discriminating Lending Practices, Stockbroker Fraud Blog, December 21, 2011 Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"