UPDATE 1-Ameriprise to pay $17.3 mln in fraud settlement

* Ameriprise to pay $17.3 million settlement

* Ameriprise does not admit, deny wrongdoing

(Adds details)

WASHINGTON, July 10 (Reuters) - Ameriprise Financial
Services (AMP.N), a Minneapolis-based broker dealer, agreed to
pay $17.3 million to settle accusations that it pocketed
millions of dollars in undisclosed compensation to sell certain
real estate investment trusts (REITs) to its brokerage
customers, the U.S. Securities and Exchange Commission said on
Friday.

As part of the settlement, Ameriprise did not admit or deny
any wrongdoing.

The SEC said Ameriprise demanded and received so-called
"revenue sharing" payments for sales of the REITs and failed to
disclose the payments as required. Ameriprise also violated
federal securities laws by selling more than $100 million of
unregistered shares of one particular REIT, the agency said in
a statement.

"Few things are more important to investors than getting
unbiased advice from their financial advisers," said Robert
Khuzami, the SEC's enforcement director. "Ameriprise customers
were not informed about the incentives its brokers had to sell
these investments."

The SEC said its investigation was continuing.

(Reporting by Julie Vorman, editing by Matt Daily)