Four years ago, Glenn Neasham met with Fran Schuber and her long-time companion to close the sale of a fixed indexed annuity that would assure the 83-year-old senior of a guaranteed income for the remainder of her retirement years. Except for Schuber’s designation of the annuity’s contingent beneficiary, Neasham viewed the transaction as straightforward—one of many the veteran life insurance agent had carried out of a popular product since it became widely available the same year.
The sale turned out to be anything but routine. Neasham, 52, now stands guilty of felony theft under California’s financial elder abuse statute. The crime: selling an annuity to a woman suffering from dementia. Stripped of his insurance license and dependent on financial assistance from family members, the once-successful producer now is free on bail pending the appeal of an October 21 sentence that had called for him to serve 300 days in prison, which was later reduced to only 90 days.
This issue—not the product’s suitability or Schuber’s competence to agree to the transaction—was the sole complication that Neasham thought might invite scrutiny from Allianz or the State of California Insurance Dept. And so, Neasham says, he had Schuber sign a “CYA” letter confirming her choice of beneficiary. The letter also states that she purchased the annuity of her “own free will,” in part to secure the product’s tax-favored treatment.
Neasham adds that, the day after the sale, he invited the son to a client appreciation dinner that Schuber was scheduled to attend. But the son declined; thus was lost an opportunity to patch up relations with his mother and get himself named as the annuity’s contingent beneficiary.
“Penny, who is now a medical assistant, has worked with many people who have dementia and she noticed nothing wrong with Fran during our September 2009 meeting,” says Neasham. “I haven’t seen Fran since, other than the two times at the court house during my trial. She is remarkably different today than in 2008 and 2009.”
Jochim agrees, adding that Schuber was only diagnosed with Alzheimer’s Disease in August of 2011. It is true that Schuber exhibited dementia-like symptoms as early as 2003. But, Jochim and Neasham insist, her condition was only definitively identified long after the sale. And, in any case, Neasham says, he did not know about Schuber’s medical history.
None of these points made a lasting impression on the jury at trial. And a key reason, a member the panel contends, is the bias that several members of the panel held against Neasham, and to an extent, the life insurance industry.
The Case Going Forward
In preparation for appeal, Neasham says he’s established a legal fund to hire an experienced appellate court attorney—he cites San Francisco-based Dennis Riordan, a renowned appellate litigator, as his first choice—to represent him in place of a public defender. But the total raised at press time, $7,250, remains short of the estimated $50,000 Neasham and his supporters believe he’ll need to pay for an adequate defense.