Ameriprise Financial and Piper Sandler & Co. have agreed to pay the U.S. Securities and Exchange Commission millions of dollars to settle charges of widespread recordkeeping failures, the latest tranche of businesses charged by the agency in recent years over use of off-channel communication.
Ameriprise, Piper Sandler agree to pay SEC millions in recordkeeping settlement
Regulators found the Minneapolis financial services firms violated recordkeeping provisions of federal securities laws.
The Minnesota Star Tribune
August 15, 2024 at 6:29PM
The two Minneapolis-based companies are among 26 investment, financial advisory and broker firms ordered to pay a combined $392 million. Ameriprise Financial will pay $50 million, and Piper Sandler $14 million.
The SEC found widespread use by personnel at the firms of personal devices, private email accounts and other means outside approved communication channels to send and receive documents. Those documents, the SEC says, must be maintained in specific channels under federal law.
“The failure to maintain and preserve required records deprives the SEC of these communications in its investigations,” the agency said in a statement. “The failures involved personnel at multiple levels of authority, including supervisors and senior managers.”
Financial firms based in Minneapolis or that have a large footprint in Minnesota have received similar penalties from the SEC this year. In February, 16 firms, including Minneapolis-based U.S. Bancorp, the parent company of U.S. Bank, and subsidiaries of Huntington Bancshares Inc., the parent company of Huntington Bank, had to pay a combined more than $81 million to settle charges of recordkeeping failures. U.S. Bancorp agreed to pay $8 million; Huntington agreed to $1.2 million.
In 2023, Wells Fargo subsidiaries agreed to pay $125 million because of recordkeeping failures, and in 2021, J.P. Morgan Securities, a subsidiary of JPMorgan Chase & Co., agreed to $125 million payment for failures that took place between 2018 and 2020.
In a statement, Ameriprise Financial said, “We are pleased to settle this industry-wide matter.” Piper Sandler declined to comment.
In October 2022, the SEC adopted amendments to the electronic recordkeeping, production of records and third-party recordkeeping service requirements applicable to brokers and security-based swap dealers and participants. The amendments were designed to “modernize recordkeeping requirements given technological changes over the last two decades and to make the rule adaptable to new technologies in electronic recordkeeping,” according to the SEC.
“We remain committed to ensuring compliance with the books and records requirements of the federal securities laws, which are essential to investor protection and well-functioning markets,” Gurbir Grewal, director of the SEC’s division of enforcement, said in a statement.
When clients of DPB Legal learned that asylum information they’d received was incorrect, they dropped the Minneapolis law firm but did not receive a refund on their retainers.
