The Financial Industry Regulatory Authority (FINRA) announced today that it has fined Ameriprise Financial Services, Inc. $850,000 for failing to detect the conversion of more than $370,000 from five customer brokerage accounts by one of its registered representatives. Ameriprise failed to adequately investigate red flags associated with nine third-party wire requests, including that the funds were being transmitted to a business bank account associated with an Ameriprise representative. The conversion went undetected for two years because Ameriprise failed to establish and enforce a supervisory system reasonably designed to adequately monitor the transmittal of funds from customer accounts to third parties, including those controlled by registered representatives of the firm. After Ameriprise discovered the misconduct, it paid restitution, plus interest and related fees, to the customers. FINRA barred the representative in June 2014.
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