The Financial Industry Regulatory Authority (FINRA) has fined Ameriprise Financial (AMP -0.22%) $750,000 for not having adequate oversight of customer requests for wire transfers and transmission of customer funds to third-party accounts.
According to FINRA, former Ameriprise registered representative Jennifer Guelinas illegally transferred approximately $790,000 from two customer accounts to her own outside accounts from 2006 to 2010. Ameriprise paid full restitution to the customers and FINRA barred Guelinas from the finance world in 2011. She pleaded guilty to wire fraud last May, according to a Reuters report.
Among FINRA's findings, the authority said that Ameriprise "failed to establish, maintain and enforce supervisory systems designed to review and monitor the transmittal of funds from customer accounts to third-party accounts." Ameriprise and its affiliated clearing arm American Enterprise Investment Services Inc. lacked policies or procedures and failed to detect the fraud despite multiple "red flags," according to FINRA.
FINRA Executive VP and Chief of Enforcement Brad Bennet noted in a statement today that "Firms must have robust supervisory systems to monitor and protect the movement of customer funds." FINRA said Ameriprise and AEIS have neither admitted nor denied the charges, but consented to the entry of FINRA's findings.
