Tr?id=566623520170033&ev=PageView&noscript=1

SEC Charges RiverSource Distributors With Improper Switching of Variable Annuities

Posted on June 8th, 2022 at 11:23 AM
SEC Charges RiverSource Distributors With Improper Switching of Variable Annuities

From the Desk of Jim Eccleston at Eccleston Law:

The Securities and Exchange Commission (SEC) has agreed to a settlement with RiverSource Distributors Inc. for improper switching or replacing of variable annuities. According to the SEC, RiverSource sold variable annuities to retail clients through an affiliated investment advisory firm, Ameriprise Financial Services. 

This action is the SEC’s first enforcement proceeding under Section 11 of the Investment Company Act of 1940. Under Section 11 of the Investment Company Act, any underwriter is prohibited from making an offer to exchange the securities of registered unit investment trusts unless the terms of the offer have received SEC approval. 

Certain RiverSource employees designed and utilized a sales practice that caused exchange offers to be presented to holders of variable annuities to switch from one variable annuity to another, which ultimately generated increased sales commissions for RiverSource employees, according to the SEC. The SEC additionally alleged that the exchange transactions occurred frequently from 2016 until 2018 when RiverSource’s compliance department condemned the sales practice. RiverSource consented to the SEC’s allegations without admitting or denying any investigatory findings and will pay a $5 million civil penalty. 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

 
 

Tags: eccleston law, sec, variable annuities

Return to Archive

TESTIMONIALS

Previous
Next
Quotes Bigger

You were most helpful with my FINRA deposition. You are a good lawyer and a good person.

Dan B.

LATEST NEWS AND ARTICLES

1782744905 Law
June 29, 2026
Former Arvest Wealth Representative Sanctioned by FINRA Over Improper Use of Mistaken Commission Payment

The Financial Industry Regulatory Authority (FINRA) has suspended former Arvest Wealth representative Brandon Still for 18 months and fined him $5,000 after determining that he improperly used firm funds that were mistakenly deposited into his account.

1782497406 Law
June 26, 2026
FINRA Seeks to Make Remote Inspection Program Permanent

The Financial Industry Regulatory Authority (FINRA) is seeking approval from the Securities and Exchange Commission (SEC) to make its pandemic-era remote inspections program permanent before the current pilot is scheduled to expire in June 2027, according to AdvisorHub and FINRA's summary of its recent Board of Governors meeting.

1782400213 Law
June 25, 2026
SEC Alleges Illinois Investment Adviser Misappropriated Investor Funds and Concealed Losses

According to a litigation release published on SEC.gov, the Securities and Exchange Commission (SEC) has charged John Sterling Myers and his firms, Sterling Capital, LLC and Sterling Capital Management, LLC, with orchestrating a multi-year fraud involving investor funds held in a pooled investment vehicle.