Filed Under:Annuities, Suitability

FINRA keeping busy with enforcing annuity sales misdeeds

Selling the wrong annuity product to the wrong person is no laughing matter,  (AP Photo/Chris O'Meara, 102 year-old Florida woman, Nov. 6, 2012)
Selling the wrong annuity product to the wrong person is no laughing matter, (AP Photo/Chris O'Meara, 102 year-old Florida woman, Nov. 6, 2012)

Suitability sales issues continue to be an problem for an aging nation, and the NAIC has weighed in after a Government Accountability Office (GAO) report warning on suitability questions involving insurance and investment product sales to veterans. The Financial Industry Regulatory Authority ("FINRA") has been actively enforcing all manner of annuity transaction misdeeds nationwide on as regular of a basis as any state insurance department, according to recent enforcement reports from the agency.

Recently, FINRA censured a firm and fined it $40,000 to settle allegations (not admitted or denied) that, among other things, the firm failed to gather and maintain required documentation about variable annuity transactions and the customers. Sampled transactions of the firm, Allied Beacon Partners, Inc., Richmond, Va., lacked certain customer information or documentation needed in order to make a reasonable suitability determination, FINRA alleged in its consent order description of enforcement actions rounded up in October.

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Nichole Morford

Nichole Morford
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