FINRA Fines Ameriprise for Arbitration Discovery Abuse
FINRA has sanctioned Ameriprise and one of its brokers for altering documents and refusing to produce documents in an arbitration proceeding.
According to FINRA, Ameriprise and its broker produced documents in an arbitration proceeding without disclosing that the broker had altered the documents after receiving a complaint letter from the customer. The customer’s attorney requested discovery to determine whether the notes had been altered but the request was opposed by Ameriprise. Then, on the eve of the arbitration hearing, Ameriprise found a supervision (exception) report relevant to the alteration claims which should have been provided months earlier. A forensic examination of the broker’s hard drive revealed substantive edits that the broker had made to the notes after receiving the customer complaint letter.
At the conclusion of the arbitration hearing, the arbitration panel sanctioned Ameriprise and its broker for violating arbitration discovery rules. Thereafter, FINRA Enforcement suspended for three months and fined him $50,000. Ameriprise was fined $100,000.
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