________________________ 

 

 

 

 

 

 

UNITED STATES OF AMERICA 

Before the
 

SECURITIES AND EXCHANGE COMMISSION 

INVESTMENT ADVISERS ACT OF 1940 

Release No. 2452 / December 1, 2005 

INVESTMENT COMPANY ACT OF 1940 

Release No. 27171 / December 1, 2005 

ADMINISTRATIVE PROCEEDING 

FILE NO. 3-12114 

: 

In the Matter of :

 : 

American Express : ORDER DIRECTING APPOINTMENT 

Financial Corporation : OF TAX ADMINISTRATOR 

(now known as Ameriprise : 

Financial, Inc.), : 

:

 Respondent. : 

__________________: 

By order dated December 1, 2005, the Commission ordered Respondent American 

Express Financial Corporation (now known as Ameriprise Financial, Inc.) (“AEFC”) to pay 

disgorgement and prejudgment interest and a civil monetary penalty in the total amount of 

$15 million to the Commission (the “Distribution Fund”) within 60 days of the entry of the 

order. The Commission has solicited proposals from several tax firms and has determined 

that Damasco & Associates, located in San Francisco, California, is best suited to act as tax 

administrator in this proceeding. 

Accordingly, IT IS ORDERED that: 

A. Pursuant to Rule 1105(a) of the Commission’s Rules on Fair Fund and 

Disgorgement Plans, Damasco & Associates be appointed as tax 

administrator (the “Tax Administrator”) for the Distribution Fund with 

limited authority and power to: (1) act as the administrator for tax purposes 

for the qualified settlement fund (“QSF”); (2) prepare, sign and file the 

necessary tax returns and tax-related documents for the Distribution Fund; 

(3) obtain the necessary tax-related documents and identifiers, such as an 

employee identification number, on behalf of the Distribution Fund; (4) 

perform other tax-related and reporting duties on behalf of the Distribution 

Fund as required by Department of the Treasury regulations relating to 

QSF administrators; and (5) communicate on behalf of the Distribution 

Fund on matters set forth in this paragraph. 
 

 

 

B. The bond requirement of Rule 1105(c) of the Commission’s Rules on Fair 

Fund and Disgorgement Plans is waived for good cause shown, 

specifically, as further described below, because the Tax Administrator 

shall never have custody or control of the Distribution Fund; 

C. The Tax Administrator shall submit, at least 30 days prior to any date on 

which a tax payment is required on behalf of the QSF, or as soon as is 

practicable, documents showing the amount necessary to satisfy the tax 

liability of the QSF as well as all other documents supporting such 

amount. The Tax Administrator shall submit such documents to the 

Office of Financial Management (“OFM”), Securities and Exchange 

Commission, Operations Center, 6432 General Green Way, Stop 0-3, 

Alexandria, VA 22312, with a copy to the assigned staff member. OFM 

shall pay the amount of the documented taxes to the Tax Administrator by 

check or wire transfer from the Distribution Fund. Such tax payments will 

come first from any earnings or interest in the QSF, and second, if 

necessary, from the principal of the QSF. The Tax Administrator, in turn, 

shall be responsible for paying the taxes to the IRS and the relevant state 

taxing authority, if any, on behalf of the Distribution Fund. 

D. The Tax Administrator shall comply with all reporting requirements 

applicable to a qualified settlement fund as defined in Treasury 

Regulations Section 1.468B-1(a), as amended, and shall file on a timely 

basis all required federal, state, and local tax returns, and shall 

contemporaneously provide copies of such filings to the assigned 

Commission staff member. 

E. The Tax Administrator shall keep records and bill each QSF for the 

services provided to it. Each bill shall be reviewed by the assigned 

Commission staff member. The Tax Administrator will submit the bill to 

the Respondent for payment by check or wire transfer. The fees billed 

shall be as agreed upon in the Tax Administrator’s engagement letter 

accepted by the Commission on March 8, 2005. 

By the Commission. 

Jonathan G. Katz 

Secretary 

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