Scathing Column On Securities America Sales Practices By Minneapolis StarTribune Is Blind To Ameriprise's Mistakes

Friday, April 29, 2011 09:13
Scathing Column On Securities America Sales Practices By Minneapolis StarTribune Is  Blind To Ameriprise's Mistakes

Tags: compliance | fraud | independent broker-dealers | securities fraud

Securities America, which is to be sold by Ameriprise, was the subject of a scathing column yesterday by a newspaper columnist in Minneapolis.

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A column entitled, "Securities America: Boiler Room On Prairie," called the firm "a stain on the Ameriprise brand," adding that "keeping it would threaten to undermine the trust and credibility Ameriprise worked so diligently to build."


What a strange column!


I'm no apologist for BDs with bad sales practices. Regulators should cripple firms with a pattern of ethical problems. 


The StarTribune columnist, Eric Wieffering, fails to understand that Securities America is part of Ameriprise, and that Ameriprise supervises Securities America.


Ameriprise is as much to blame for the Medical Capital disaster as Securities America!


Anyone who knows the executives running Securities America knows they were victimized as much by the Medical Capital fraud as their clients.


Medical Capital was a criminal enterprise.  When crooks are intent on committing fraud, it can be difficult to detect.


Due diligence has to be aggressive, and Securities America could be faulted for not doing enough due diligence, but so can most BDs. So can Ameriprise.


This column by Wieffering fails to point out that Ameriprise has had its own problems with sales practices. It's the only brokerage I know of with a consumer site dedicated to blasting it. Check out


Securities America did the due diligence that was customary and accepted at that time, but had the horrible luck of selling a lot of investors a deal that turned out to be a fraud. 


Apart from the Medical Capital deal, Securities America probably has had its share of dishonest advisors working for it because they hide their corrupt or aggressive sales practices cleverly.  But Securities America is not known for being a friendly home to financial advisors with bad sales practices.


In good times, due diligence gets sloppy and bad deals get sold. But the Madoff fraud and wave of frauds--at RIAs as well as BDs---that have come to light in the last two and a half years has swung the pendulum back toward increased due diligence and investor protection. 


The culture at Securities America is not corrupt and the people who work there are as honest as others working in the industry.


And if you want to blame management for not being diligent enough about compliance, Ameriprise management--which controls Securities America--shares as much or more of the blame. 












Comments (3)

I can't believe no one has the guts to comment on this post. What is the matter with you people?

I see Advisors4Advisors Web statistics. I know we get more unique visitors to than some of the most popular advisor destinations on the Web.

I know some fee-only advisors will be angry because I'm being sympathetic to Securities America. And some SA reps will be unhappy with me for besmirching their brand.

But unless we get to truth, rumors will linger and nonsense will dominate the historical record created by Google.

This is the brutality of the Web and its beauty.

What's the truth?

agluck , April 30, 2011
I have worked with home office people at SAI, and I know some of their advisors. They are all quality people. Every firm will have bad apples, but I don't know any there.

I also know Ameriprise reps. The ones I am closest to are some of the most professional advisors I know. However, because they recruit new people into the business and have proprietary product, they have a number of conflict of interest problems.

Based on what I know, I expect more sales practice problems from Ameriprise than Securities America. As you point out, when times are good, due diligence can get lax. I know that firsthand from running independent BDs. If one of those programs blows up, your lack of diligence will cost you, and it did for SAI. I can think of a number of firms that, but for the grace of God, could be in the same situation.

As you point out, Ameriprise is in the supervisory hierarchy along with the compliance people at SAI. The SAI people are not evil, and the Ameriprise people are not blameless.
stephenw585 , May 02, 2011
On May 19, we ran an item entitled, "Ameriprise Fined $50,000 For Waiting Two Years To Punish Broker Who Forged Paperwork." Where's StarTribune columnist, Eric Wieffering, now?
agluck , May 23, 2011

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