DOL Fiduciary Rule
Ameriprise Financial

Ameriprise Drops Hundreds of Funds Offered to Brokerage Clients

Advisors will no longer be able to offer clients hundreds of investments, but few assets managed by the brokerage will be affected.

Ameriprise Financial Services told advisors Monday it will cut the number of products available to brokerage clients ahead of the Department of Labor’s fiduciary rule that becomes applicable Friday. 

Secretary of Labor Alexander Acosta announced in a May 22 Wall Street Journal op-ed that his agency would not delay the applicability date again, although public comment on the rule is still being gathered. In his letter, Acosta also encouraged the Securities and Exchange Commission to consider assessing retail investment advice, which it announced June 1 that it would.

In a memo sent to brokers on Monday, Ameriprise said that more than 1,500 funds would no longer be available to clients. A person familiar with the situation said the move was part of a due-diligence effort to meet the new standards. Funds that will no longer be offered include mutual funds, exchange traded funds, exchange traded notes and closed end funds.

“We are further enhancing our robust due diligence standards to ensure our clients and advisors continue to have access to a broad, quality investment portfolio to achieve their goals," said Kathleen McClung, an Ameriprise spokeswoman. "We continue to offer thousands of funds from hundreds of firms.”

Bad performance, high costs and the small amount of assets invested in them were among reasons the funds will no longer be offered. The affected assets totaled just 5 percent of all assets managed by the brokerage, according to a person familiar with the decision.

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