In an alleged failure of its compliance systems,
Ameriprise Financial Services Inc. became aware of a broker purportedly forging client documents — but then took almost two-and-a-half years to investigate and boot the broker from the firm.
According to an April letter of acceptance, waiver and consent Ameriprise signed with the
Financial Industry Regulatory Authority Inc., the alleged forgeries occurred from January 2003 to October 2007. That's when the former Ameriprise broker, William Ray Collins, allegedly forged signatures of 10 customers on 34 documents that he submitted to Ameriprise for processing.
“An Ameriprise surveillance analyst became aware of potential forgeries by [Mr.] Collins in December 2005,” the Finra letter said. “However, the analyst failed to follow up with a timely investigation, and Ameriprise's supervisory system did not ensure that a timely investigation was conducted.”
By March 2008, Ameriprise had created a new set of procedures for broker surveillance. At that point, the brokerage discovered that the investigation of Mr. Collins had not been completed. It reassigned the investigation to other personnel, completed the inquiry within a month and discovered “ample evidence of repeated forgeries by [Mr.] Collins,” the Finra letter said. The firm then fired Mr. Collins.
Finra censured Ameriprise and fined it $50,000 for the matter. “Ameriprise failed to establish, maintain and enforce a supervisory system that was reasonably designed to detect and prevent misconduct by one of its brokers,” and thereby violated Finra rules, according to the letter. In addition, Ameriprise has refunded and reimbursed three of Mr. Collins' clients about $35,000 stemming from signatures that were not authentic, according to Mr. Collins' Finra BrokerCheck report.
Amerirpise declined to comment about the matter, according to Chris Reese, a company spokesman.
Finra permanently barred Mr. Collins, a 10-year veteran of Amerirpise, in 2010, according to his record on Finra's BrokerCheck system. In agreeing to being barred, he neither admitted or denied Finra's findings over the forgeries,
His alleged forgeries occurred on a number of documents. They included: “cash distribution forms, mutual fund redemption forms, financial advisory service agreements, authorizations for release of health information, variable life insurance illustrations, life and disability income insurance applications and bank authorization firms,” according to the Finra letter. “In addition, in May 2005, [Mr.] Collins agreed to pay certain fees for two customers without alerting Ameriprise in order to avoid complaints from these customers.”
