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Recovering Losses Caused By Investment Misconduct

Pennsylvania Regulators Allege TD Ameritrade Misrepresented Its Reserve Yield Plus Fund to Investors

Pennsylvania regulators have filed a civil lawsuit against TD Ameritrade alleging that the company defrauded investors in the sale of its Reserve Yield Plus Fund by misrepresenting the cash-enhanced mutual fund as a money-market fund, according to an August 9 WSJ blog article by Daisy Maxey.

The Pennsylvania Securities Commission's enforcement division alleges that the firms' misrepresentations regarding the fund were recorded.

The complaint also alleges that TD Ameritrade and Amerivest Investment Management LLC, both subsidiaries of TD Ameritrade Holding Corp, continued to sell the fund as a money-market fund even after receiving information from senior management that indicated the fund's net asset value would likely dip below $1 per share, which is the level most money-market funds strive to maintain.

The Reserve Yield Plus Fund once held $1.2 billion in assets, according to Maxey's article. Approximately $39.7 million remains, which has been set aside by the fund's trustees to pay potential claims and fees.

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