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Wednesday, December 26, 2012

Ameriprise - It's What They Do

Here's a news item on Amerprise workers bringing a lawsuit against the company for loading up the company 401(k) plan with its own expensive, underperforming mutual funds and charging employees excessive fees.

The article states,
The fees for the RiverSource funds that are current investment options are significantly higher than for comparable mutual funds in other 401(k) plans as well as the other options available in the Ameriprise plan, according to the complaint. For example, the fee for the RiverSource midcap fund around 2005 was a high 1 percent, and the comparable Vanguard fund charged 0.08 percent, the plaintiffs argue.
I can understand the ongoing business strategy of exploiting clients and plan administrators by over-charging for funds.  After all, it's what they do.  But...their own employees?  They surely understand they are a fidiciary as administrators of their employees' plan, which they are not as providers to other plans.

I would think this would be a wake-up call to plan administrators around the country.


  1. I have never been a fan of stocks in the financial services sector. I have never invested in a single financial service stock. I do not consider financial service companies to even be real comapnies A good example of this is insurance companies when you buy insurance all you are doing is being put in a risk pool and the money is just being moved around from one person to another theirs really no real product or service being sold or produced.

    I knew that this type of financial crisis would happen sooner or later. The housing bubble was caused by excesses in making credit available to those unable to afford it. Home prices in certain areas were very inflated and still are in many places. Companies in the financial services sector were to a large degree responsible for the housing bust. The financial services sector is supported by the federal reserve.

    The intentional devaluation of our currency is the primary cause of the increasing inequality that we see today. The value of the dollar today is close to one eighth its value of fifty years ago.