Ameriprise Financial Services, Inc., has agreed to pay the Securities and Exchange Commission $17.3 million to settle an enforcement action the SEC levied against the Minneapolis-based broker/dealer. The SEC alleges that Ameriprise received millions of dollars in undisclosed compensation as a condition of offering and selling certain real estate investment trusts (REITs) to its brokerage customers.
The SEC’s order says that “Ameriprise demanded and received so-called ‘revenue sharing’ payments related to its sales of REITs and failed to disclose the payments as required. Ameriprise also sold more than $100 million of unregistered shares of one particular REIT in violation of the registration provisions of the federal securities laws.”
Robert Khuzami, Director of the SEC’s Division of Enforcement, said in a prepared statement announcing the enforcement action that “Few things are more important to investors than getting unbiased advice from their financial advisers. Ameriprise customers were not informed about the incentives its brokers had to sell these investments.”