TIAA, one of the nation's largest and most trusted investment advisory firms, fraudulently pushed tens of thousands of its customers into higher-fee accounts, benefitting the firm but raising investors' costs, according to a settlement with the firm announced today by Letitia James, the New York attorney general, and the federal Securities and Exchange Commission.
"For years, TIAA put profits over people, taking money from people's hard-earned retirement funds," said James, announcing the settlement. "TIAA relied on its reputation as a trusted and objective financial adviser to profit off of clients through fraudulent and manipulative sales practices."
Calling it a case of "corporate greed," the attorney general said TIAA would pay $97 million to settle the matter, money that will go back into the pockets of affected clients throughout the U.S. TIAA must also reform its sales practices under the deal, which also includes a $9 million civil fine.
