Ameriprise paid $15 million over mutual-fund market-timing practices contrary to prospectus disclosures

Summary

The SEC brought a separate enforcement action against American Express Financial Corporation, now Ameriprise Financial, concerning market timing in mutual funds it advised. The SEC found that the firm permitted certain shareholders to engage in market timing even though prospectus disclosures for the American Express Funds stated that such market timing was prohibited. The conduct created a conflict between the restrictions described to ordinary investors and the treatment provided to selected market timers. Ameriprise agreed to pay $15 million in disgorgement and civil penalties, with the money placed into a Fair Fund for affected shareholders. It also agreed to governance and compliance undertakings concerning market timing. Primary source: SEC — Ameriprise Financial to Pay $15 Million to Settle Market Timing Charges: https://www.sec.gov/news/press/2005-169.htm